In the
United States Court of Appeals
For the Seventh Circuit
____________________
Nos. 11‐3240, 12‐1207, & 12‐1295
UNITED STATES OF AMERICA,
Plaintiff‐Appellee,
v.
CHARLES WHITE, NORTON HELTON, AND FELICIA FORD,
Defendants‐Appellants.
____________________
Appeals from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 06 CR 763 — Samuel Der‐Yeghiayan, Judge.
____________________
ARGUED SEPTEMBER 20, 2013 — DECIDED DECEMBER 13, 2013
____________________
Before WOOD, Chief Judge, and FLAUM and BAUER, Circuit
Judges.
FLAUM, Circuit Judge. Charles White, Felicia Ford, and
Norton Helton were three players in a major mortgage fraud
scheme. Charles White was the scheme’s mastermind and
principal. Through fraudulent mortgage loan applications,
he obtained financing for straw purchasers to buy properties
from homeowners on the brink of foreclosure. Unbeknownst
to the owners, White’s goal was not to save their homes, but
2 Nos. 11‐3240, 12‐1207, 12‐1295
instead to strip the properties of their equity for his own
gain. Felicia Ford was the closing agent. Though she was
supposed to act as the lender’s representative in the transac‐
tions, she instead fabricated official documents to facilitate
White’s scheme. Norton Helton was the attorney. At White’s
behest, Helton “represented” the homeowners during the
closings—that is, he falsely assured clients that everything
was in order while pocketing legal fees paid out of the equi‐
ty proceeds. Helton also orchestrated the scheme’s cover‐up
by representing the homeowners in their subsequent bank‐
ruptcy filings. All three players were convicted of multiple
counts of wire fraud for their participation in the scheme;
Helton was also convicted of bankruptcy fraud. The three
defendants now appeal a multitude of substantive and pro‐
cedural issues stemming from their trial and, in White’s case,
his sentence. We affirm on all issues.
I. Background
Defendant White owned and operated Eyes Have Not
Seen (“EHNS”), a company that offered a “mortgage
bailout” program to insolvent homeowners in the Chicago
area.1 EHNS told these homeowners that they could stave off
foreclosure by transferring their homes to EHNS “investors”
for a one‐year period. EHNS represented that the investors
would pay the property’s mortgage; the owners could then
continue to live in their home, take the year to improve their
financial health, and reassume their mortgage obligation at
1 The company’s name references 1 Corinthians 2:9: “But as it is written,
Eye hath not seen, nor ear heard, neither have entered into the heart of
man, the things which God hath prepared for them that love him.”
Nos. 11‐3240, 12‐1207, 12‐1295 3
the program’s conclusion. In reality, however, EHNS inves‐
tors would take title to the home outright. White would
pressure EHNS’s appraisers to assess the properties at
amounts higher than their actual value. Then, EHNS would
strip both the available and manufactured equity from the
property in the form of transaction fees. The clients almost
always were unable to buy back their homes at the conclu‐
sion of the one‐year program. Eventually, lenders foreclosed
on many of the properties.
EHNS advertised on gospel radio stations and solicited
clients through public foreclosure lists. Many clients testified
that they did not fully understand the transactions they were
participating in. White and EHNS employees often did not
explain that the homeowners would actually sell their prop‐
erties to a third party. Instead, clients were told that they
would be temporarily “transferring” their homes in a way
that would preserve their ownership rights, or that they
would co‐own the property with the investor.
White and EHNS employees recruited the investors—i.e.,
the straw purchasers—by paying them an amount per trans‐
action. Sometimes, they used a client’s family member in‐
stead. White was responsible for obtaining the requisite
mortgage financing for the property’s purchase. He accom‐
plished this by submitting fraudulent loan applications to
lenders. White’s common tactics included lying about the
investor’s employment history (usually by stating that the
investor was employed by EHNS or another of White’s
companies), inflating the investor’s assets, and including in‐
correct bank account information. White also falsely repre‐
sented to the lenders that the investors planned to live in the
property. To conceal his role in these applications, White
4 Nos. 11‐3240, 12‐1207, 12‐1295
would prepare and submit applications under several differ‐
ent aliases.
Once the lenders gave the loans preliminary approval,
they wired the loan funds to an escrow account at Title
Zone, L.L.C. White had helped create Title Zone, and the
company’s Chicago branch shared an office suite with
EHNS. Defendant Ford was a closing agent at Title Zone
who had been hired on White’s recommendation. Ford per‐
formed many of EHNS’s transactions. As a closer, Ford
served as a representative for the mortgage lender. Ford was
supposed to follow the lender’s closing instructions, ensure
that all of the lender’s conditions were met, and submit the
required documents to the lender for approval. Only then
would the lender authorize release of the loan funds from
the escrow account, which Ford could then distribute to the
parties.
Ford used her position to contribute to the scheme’s suc‐
cess in several ways. For one, Ford (or her assistant) would
prepare two versions of the required HUD‐1 settlement
statements: a version to be submitted to the lenders, and a
version for the transacting parties. The version for the
homeowners and investors would contain true information
about the amount of EHNS’s fees. The version that Ford
submitted to the lenders, however, omitted these fees. In
addition, Ford would accept a cashier’s check for the mort‐
gage’s down payment from White—despite her knowledge
that White was not the purchaser. Ford would nonetheless
represent to the lender that the investor had been the one to
provide the funds. And in some transactions, Ford would
arrange for EHNS to receive the loan proceeds before White
made the down payment. Ford (or her assistant) would cre‐
Nos. 11‐3240, 12‐1207, 12‐1295 5
ate what looked like a photocopied image of the investor’s
down‐payment check by cutting and pasting the information
for the current transaction onto an image of a cashier’s check
from a previous transaction. Ford would fax the fabricated
check image to the lender to get the bank to release the loan
funds, but she would delay sending the actual check. This
allowed White to subsequently draw upon the loan funds to
cover the down payment. For her services, Ford received
kickbacks from White and EHNS in the form of “bonuses”
and other payments.
Then there was defendant Helton. EHNS clients were
told that Helton, a real estate attorney, would be present at
the transaction’s closing to represent them. Usually the cli‐
ents would not meet Helton before the day of the closing.
When clients asked questions, Helton described the mort‐
gage bailout program in the same terms as EHNS—that is,
he did not tell the homeowners that they were selling their
home outright. He would also assure hesitant clients and in‐
vestors of the paperwork’s accuracy, and on at least one oc‐
casion he discouraged a homeowner from reading the doc‐
uments herself.
Clients were told that EHNS would use the loan pro‐
ceeds to pay their mortgage for a year. EHNS usually ful‐
filled this promise, but White withdrew more equity from
the sale than was necessary to cover the mortgage and
EHNS’s costs. In fact, EHNS usually took all of the available
equity in the form of large fees—for EHNS, for White’s loan
officer commissions, and for Helton’s legal services. The cli‐
ents were often unaware that EHNS was taking these fees.
Next came the bankruptcy filings. White and EHNS em‐
ployees told clients that they needed to improve their credit
6 Nos. 11‐3240, 12‐1207, 12‐1295
so that they could reassume their mortgages at the pro‐
gram’s conclusion. They referred clients to Helton, who told
them that they could restore their financial health by filing
for Chapter 7 bankruptcy; sometimes he pressured them to
do so. During his clients’ bankruptcy proceedings, Helton
took steps to prevent the trustee, their creditors, and the
court from discovering that the debtors had recently sold
their homes through the bailout program. When Helton and
his staff filed petitions and asset schedules on behalf of cli‐
ents, they omitted any reference to the EHNS sales or the
properties in question—even when Helton had been person‐
ally present at the property’s sale. Helton also coached his
clients before their § 341 meetings of the creditors to tell the
trustee that the client had never owned real estate, or else to
say that the client lost the property in foreclosure. When his
clients followed his instructions and lied, Helton did not cor‐
rect the false representation. When one client told the trustee
the truth about having recently owned property, Helton be‐
came angry with her. And when a trustee did learn of a
debtor’s recent EHNS transaction, Helton lied and said that
he was personally unfamiliar with the program.
Helton also carried out a side scheme using his own
“mortgage bailout” company, Diamond Management. Hel‐
ton employed virtually the same tactics as White and EHNS:
he recruited straw purchasers, he provided the down pay‐
ment checks himself, he used Ford and Title Zone’s services
Nos. 11‐3240, 12‐1207, 12‐1295 7
at the closings, and he encouraged his clients to file for
Chapter 7 bankruptcy afterward.2
Eventually, the authorities caught on, and Helton was
charged with bankruptcy fraud. This led to the unraveling of
the whole EHNS scheme. The federal grand jury returned a
fourth superseding indictment in March 2010 charging
White, Ford, and Helton with multiple counts of wire fraud
in violation of 18 U.S.C. § 1343, and Helton with multiple
counts of bankruptcy fraud in violation of 18 U.S.C. § 157.
The three defendants went to trial that year. (We will re‐
lay additional background regarding the events at trial in
our discussion of each claim of error.) White was convicted
of seven counts of wire fraud. Ford was convicted of five
counts of wire fraud and acquitted on two counts. Helton
was convicted of three counts of wire fraud and eight counts
of bankruptcy fraud. Helton and Ford filed motions for ac‐
quittal, and all three defendants moved for a new trial. The
district court denied all motions, and sentenced White to 266
months imprisonment, Helton to 180 months, and Ford to 48
months.
This appeal followed.
2 One of Helton’s three wire fraud counts concerns a Diamond Manage‐
ment transaction; the other two counts arose out of Helton’s involvement
with EHNS transactions.
8 Nos. 11‐3240, 12‐1207, 12‐1295
II. Discussion
Once we pool the three defendants’ arguments, they
have offered nearly a dozen distinct grounds for reversal.3
So we have a lot of ground to cover. We will first dispose of
Ford and Helton’s sufficiency arguments, and then proceed
with all three defendants’ claims of error in roughly the or‐
der in which the issues arose during trial and sentencing.
A. Sufficiency of the evidence against Ford
First, Ford challenges her wire fraud conviction. We re‐
view the district court’s denial of Ford’s motion for acquittal
de novo. United States v. Boender, 649 F.3d 650, 654 (7th Cir.
2011). Nonetheless, in considering sufficiency‐of‐the‐
evidence challenges, we “view the evidence in the light most
favorable to the prosecution,” and then “ask whether any
rational trier of fact could have found the essential elements
of a crime beyond a reasonable doubt.” Id. Here, we answer
that question in the affirmative.
Ford contests her conviction on the theory that the
fraudulent transactions were always completed before she
became involved. She argues that the relevant wire trans‐
missions—i.e., the transfers of the loan funds from the mort‐
gage lender to the escrow account at Title Zone—always oc‐
curred before the closings. At the time of the closing, she
maintains, the lender had already approved the loan on the
3 We asked the defendants to avoid redundancy in their briefing by join‐
ing each other’s arguments, and they obliged. As we ultimately find no
grounds for reversal, we see no need to specify which defendant adopt‐
ed which argument.
Nos. 11‐3240, 12‐1207, 12‐1295 9
basis of White’s fraudulent mortgage application. Thus, once
the wire transfers took place, the scheme was complete; Ford
says her contributions during the closings consisted of en‐
tirely separate conduct dealing only with the scheme’s “pro‐
ceeds.”
But Ford’s understanding of wire fraud is mistaken. To
establish a violation of 18 U.S.C. § 1343, the government
must prove that Ford participated in a scheme to defraud,
that she intended to defraud, and that an interstate wire was
used in furtherance of the scheme that she participated in.
See United States v. Powell, 576 F.3d 482, 490 (7th Cir. 2009).
There is no requirement that Ford personally cause the use
of the wire. United States v. Turner, 551 F.3d 657, 666 (7th Cir.
2008). Rather, the third element of wire fraud is met if the
use of a wire “will follow in the ordinary course of business,
or where such use can reasonably be foreseen, even though
not actually intended.” Id. (quoting Pereira v. United States,
347 U.S. 1, 8–9 (1954)). The jury could easily conclude that
Ford, an experienced closing agent for a title company,
would be aware that wire transfers would routinely take
place in a scheme involving loaned funds. Cf. United States v.
Sheneman, 682 F.3d 623, 630 (7th Cir. 2012) (finding it “well
within reason for the jury to conclude that [the defendant],
given his involvement in the real estate market, could rea‐
sonably foresee that lending banks would use wire transfers
to transmit loan proceeds in the course of real estate transac‐
tions”).
Moreover, the timing of the wire transfer does not de‐
termine the scheme’s end‐point. The transfer is merely a ju‐
risdictional prerequisite for the federal statute’s application.
For that reason, the transfer need not be the scheme’s objec‐
10 Nos. 11‐3240, 12‐1207, 12‐1295
tive; it need only be “a step in [the] plot.” Schmuck v. United
States, 489 U.S. 705, 710–11 (1989) (alteration in original).4
Here, the transfer of the loan funds from the mortgage lend‐
er to Title Zone was just an intermediate step—the EHNS
scheme was not complete until the defendants had the pro‐
ceeds in their pockets. For this to happen, EHNS needed
Ford to act as the closing agent and submit the proper (or
rather, improper) documentation to the lender. Only once
the lender was satisfied that everything was in order would
it authorize the release of the funds from the escrow account,
and only then could White and Helton enjoy the equity pay‐
outs that Ford distributed to them. Ford’s contributions dur‐
ing the closings—her drafting the false HUD‐1 settlement
statements, her failure to tell the lenders that the buyer was
not the one providing the down payment, and her fabricat‐
ing the cut‐and‐pasted cashier’s checks—were integral to the
scheme’s success. The fact that these contributions happened
to take place after the wire transfer is immaterial to her cul‐
pability.
The government established that Ford was an integral
participant in a scheme to defraud in which the use of a wire
was foreseeable. Accordingly, her challenge to the sufficien‐
cy of the evidence fails.
4 Though we are discussing wire fraud, we may draw upon reasoning
from mail fraud cases, as “cases construing the mail fraud statute [18
U.S.C. § 1341] are applicable to the wire fraud statute [18 U.S.C. § 1343].”
United States v. Gimbel, 830 F.2d 621, 627 (7th Cir. 1987).
Nos. 11‐3240, 12‐1207, 12‐1295 11
B. Sufficiency of the evidence against Helton
1. Wire fraud
Helton challenges his wire fraud convictions on the theo‐
ry that there was insufficient evidence supporting his intent
to defraud. “Intent to defraud requires a wilful act by the de‐
fendant with the specific intent to deceive or cheat, usually
for the purpose of getting financial gain for one’s self or
causing financial loss to another.” United States v. Britton, 289
F.3d 976, 981 (7th Cir. 2002). This may be established “by cir‐
cumstantial evidence and by inferences drawn from examin‐
ing the scheme itself that demonstrate that the scheme was
reasonably calculated to deceive.” Id.
Helton was convicted on three counts of wire fraud. With
respect to the two counts involving an EHNS transaction,
Helton argues that he was an unknowing bystander who got
mixed up in White’s scheme. By his account, Helton agreed
to represent EHNS homeowners in real estate transactions,
but he had no idea that White and Ford’s methods were not
aboveboard. But the jury found otherwise. This is not sur‐
prising, as there was overwhelming evidence from which it
could conclude that Helton knew what was going on and
furthered the scheme’s success for his own gain.
First, Helton was present at the EHNS closings. All of the
closing documents, including the loan applications and
HUD‐1 settlement statements, were available for Helton’s
review; the jury could reasonably conclude that as an attor‐
ney hired to represent the homeowner’s interests in the
transaction, Helton would have realized that the documents
were not in order. And the government presented evidence
that for certain deals, Helton was definitely made aware that
12 Nos. 11‐3240, 12‐1207, 12‐1295
the loan applications were fishy. One EHNS investor testi‐
fied that when, in Helton’s presence, the investor noticed
false information in his application and asked White about
it, White told him the falsehood was “part of the real estate
game” and “not to worry” about it. In addition, while pre‐
sent at the closings, Helton naturally would have observed
that the investor did not provide the down payment checks.
On some occasions, he would have observed that no down
payment was made at all. Yet Helton said nothing, and he
continued to represent EHNS clients in suspicious transac‐
tion after suspicious transaction. A jury could infer that he
did so not out of ambivalence, but out of a desire to pocket
more fees—fees paid out of the proceeds from the fraudu‐
lently obtained mortgage loans.
Indeed, the trial testimony showed that Helton was
White’s go‐to guy for these transactions. Viewed in the light
most favorable to the government, it was reasonable for the
jury to conclude that White would not proactively arrange
for an attorney to represent EHNS clients at the closings if
the attorney was not also a knowing participant in the
scheme. And in fact, the government presented testimony
that Helton did more than just stand by—he affirmatively
deceived clients by assuring hesitant parties that everything
was in order. For instance, when one homeowner‐client tried
to read the papers herself, Helton told her that he was in a
hurry, she did not need to read the documents, and that she
should just sign.
Further, during his subsequent representation of EHNS
clients in their Chapter 7 filings, Helton took steps to prevent
the bankruptcy trustee and bankruptcy court from learning
that the EHNS transactions ever took place. His instructions
Nos. 11‐3240, 12‐1207, 12‐1295 13
to clients to lie about their recent real estate sales during
creditor meetings, and his own lies and omissions in filings
and court appearances, could certainly lead a jury to infer
that he had a motive to cover up these transactions.
Helton also challenges his conviction on the count in‐
volving the Diamond Management deal. He argues that Di‐
amond Management’s bailout transactions were legitimate,
and that he never intended to defraud mortgage lenders.
However, the jury could conclude that the similarity be‐
tween the EHNS and Diamond Management programs, and
Helton’s adoption of White’s signature tactics—for instance,
Helton’s recruiting third‐party investors, his providing the
down payment check, and his use of Ford’s services at Title
Zone—were not coincidence. At the very least, the evidence
showed that Helton deceived the lenders in that he con‐
cealed the fact that the buyer was a straw purchaser. In addi‐
tion, the government presented evidence that Helton also
represented Diamond Management clients in their bank‐
ruptcies, and similarly concealed the clients’ recent real es‐
tate transfers from the authorities.
This was not a close call. Accordingly, we affirm the dis‐
trict court’s finding of sufficient evidence to convict Helton
on the wire fraud counts.
2. Bankruptcy fraud
For Helton to be convicted of bankruptcy fraud, the gov‐
ernment had to prove that Helton engaged in a fraudulent
scheme and that he filed a bankruptcy petition, or another
document in a bankruptcy proceeding, in order to further
the scheme. See 18 U.S.C. § 157(1)–(2); United States v. Hol‐
stein, 618 F.3d 610, 611–12 (7th Cir. 2010). The government
14 Nos. 11‐3240, 12‐1207, 12‐1295
sought to prove that Helton carried out a scheme to defraud
the EHNS clients’ creditors by concealing the fact that the
debtors had recently transferred a major asset.
Helton’s primary argument about the insufficiency of the
evidence is a red herring. He contends that he and his debtor
clients did not withhold any necessary information from the
bankruptcy court because the proceeds from the home sales
were not part of the debtors’ Chapter 7 estates. That being
the case, he argues, no creditors were actually defrauded.
Even if Helton were right that the debtors’ recent transfers of
property were of no consequence to their bankruptcy case
(he’s not),5 the government need not prove that any creditors
were actually defrauded in order to establish the elements of
bankruptcy fraud. 18 U.S.C. § 157; see also United States v.
DeSantis, 237 F.3d 607, 613 (6th Cir. 2001) (because the
“[f]iling itself is the forbidden act” under § 157, “[s]uccess of
the scheme is not an element of the crime”).
The government did have to prove Helton’s intent. It did
so by offering evidence of the steps Helton took to prevent
the bankruptcy authorities from discovering his clients’ re‐
cent sales. Helton’s defense at trial was that he did not know
that the bankruptcy petitions contained material omissions
(usually because the filings were prepared by his employ‐
ees), or that he was not aware that the clients had recently
transferred their property, or both. But the testimony of both
Helton’s employees and his clients contradicted his account.
For instance, testimony revealed that Helton filed petitions
5 Trustees testified that had they known about the real estate sales, they
would have investigated the sales as fraudulent transfers.
Nos. 11‐3240, 12‐1207, 12‐1295 15
that left out EHNS transactions at which Helton had been
physically present—in some cases only weeks before. Hel‐
ton’s employees testified that when they did include infor‐
mation about the recent property sales, Helton removed the
information before the document was filed. And the clients
testified that Helton told them to lie during their creditor
meetings and reprimanded the clients when they disobeyed
him. As we do not reweigh the evidence or second‐guess the
jury’s credibility determinations on appeal, Holstein, 618 F.3d
at 612, we need not credit Helton’s version of the story.
Thus, there was sufficient evidence to convict Helton of
both crimes, and we affirm the district court’s denial of his
motion for acquittal.
C. Joinder
We now proceed to the defendants’ various arguments
for why they should receive a new trial, beginning with
joinder. White and Ford argue that their trial was misjoined
with Helton’s under Federal Rule of Criminal Procedure
8(b). In the alternative, all three defendants argue that Hel‐
ton’s trial should have been severed on grounds of prejudice
pursuant to Federal Rule of Criminal Procedure 14.
Rule 8(b) provides that joinder is permissible when de‐
fendants “are alleged to have participated in the same act or
transaction, or in the same series of acts or transactions, con‐
stituting an offense or offenses.” We review a Rule 8 deter‐
mination de novo. United States v. Warner, 498 F.3d 666, 699
(7th Cir. 2007). We have interpreted “same series of acts or
transactions” to mean “acts or transactions that are pursuant
to a common plan or common scheme.” United States v. Ve‐
lasquez, 772 F.2d 1348, 1353 (7th Cir. 1985). In evaluating
16 Nos. 11‐3240, 12‐1207, 12‐1295
whether a common scheme exists, the court looks solely to
the allegations in the indictment. Warner, 498 F.3d at 699.
The defendants need not be charged in every count, nor
must they be charged with the same crimes. Id.
White and Ford protest that Helton’s bankruptcy fraud
“had nothing to do with the wire fraud.” We disagree. The
indictment alleges a single scheme to defraud homeowners
and lenders through EHNS’s mortgage bailout program; ac‐
cording to the indictment, the bankruptcy filings were part
of the EHNS program, and also served as the scheme’s cov‐
er‐up. The indictment alleges that White and other EHNS
employees referred clients to Helton so that they could “re‐
pair their credit.” And the indictment alleges that during the
bankruptcy proceedings, Helton took steps to conceal the
existence of the EHNS transactions from the bankruptcy au‐
thorities. Thus, the fraudulent Chapter 7 filings furthered the
overall scheme’s success by preventing the trustees and the
homeowners’ creditors from recovering the proceeds of
these sales—and of course, by shielding the defendants’ ille‐
gal activities from official investigation. Cf. Warner, 498 F.3d
at 699 (noting that “a conspiracy and its cover‐up are parts
of a common plan” (internal quotation marks omitted)). The
fact that White and Ford were not involved in the bankrupt‐
cy filings does not matter if the filings were connected to the
success of the overall scheme. Considering that we interpret
Rule 8 “broadly” so as “to enhance judicial efficiency,” id.,
we find the joinder of Helton’s bankruptcy fraud comforta‐
bly within the rule’s scope.
There remains the question whether, notwithstanding
proper joinder, the district court should have used its discre‐
tion to sever Helton’s trial on grounds of undue prejudice
Nos. 11‐3240, 12‐1207, 12‐1295 17
under Rule 14(a). Ford and White believe that their defense
was prejudiced by the evidence of Helton’s lies to the bank‐
ruptcy authorities. In turn, Helton believes he was preju‐
diced by the “inflammatory” and “sordid” evidence of
White and Ford’s deceptive tactics in carrying out the EHNS
scheme. However, “it is not enough merely to show that
separate trials might have provided the defendant a better
shot at acquittal.” United States v. Berg, 714 F.3d 490, 496 (7th
Cir. 2013). Instead, the defendant bears the “heavy burden”
of establishing that the joint trial “prevent[ed] the jury from
arriving at a reliable judgment as to guilt or innocence.” Id.
We review the district court’s decision for abuse of discre‐
tion only. United States v. Del Valle, 674 F.3d 696, 704 (7th Cir.
2012). We find the district court acted within its discretion
here.
First, Ford is conclusory in her description of how the ev‐
idence pertaining to the bankruptcies negatively influenced
the jury in its evaluation of her and White’s culpability. The
gist of her argument on appeal is that the bankruptcy evi‐
dence was extensive, time‐consuming, and did not directly
relate to the wire fraud charges. This is not sufficient to es‐
tablish that the bankruptcy evidence prevented the jury from
coming to a reliable determination of White and Ford’s guilt.
Obviously, Ford and White were not charged with bank‐
ruptcy fraud. It should have been fairly easy for the jury to
compartmentalize the evidence that applied only to Helton
from the evidence pertaining to the other two defendants—
and Ford has not persuaded us otherwise.
Nor are we persuaded by Helton’s claim of a prejudicial
spillover effect of the evidence pertaining to White and Ford.
Much of the evidence about the EHNS scheme would have
18 Nos. 11‐3240, 12‐1207, 12‐1295
been admissible against Helton regardless. See United States
v. Lanas, 324 F.3d 894, 900 (7th Cir. 2003) (co‐schemers’
claims of prejudicial joinder are “undercut by the fact that
much of the evidence admitted at their joint trial would have
been admissible against them in separate trials as well”).
Helton was charged with two counts of wire fraud arising
out of EHNS transactions that he carried out with White and
Ford, and multiple counts of bankruptcy fraud in connection
with former EHNS clients. In addition to evidence pertain‐
ing to the transactions at which Helton was actually present,
evidence about how the scheme worked generally would
have been relevant even in a Helton‐only trial. See Warner,
498 F.3d at 701 (“[E]vidence of one participant’s actions in
furtherance of a scheme to defraud is admissible against the
other participants in that scheme, just as it is in a conspiracy
case.”).
Moreover, the district judge instructed the jury that it
“must give each of [the defendants] separate consideration,”
“must analyze what the evidence shows about each defend‐
ant,” and remember that “each defendant is entitled to have
his or her case decided on the evidence and the law that ap‐
plies to that defendant.” The Supreme Court has held that
limiting instructions “often will suffice to cure any risk of
prejudice [caused by joinder],” see Zafiro v. United States, 506
U.S. 534, 539 (1993), and nothing leads us to believe that
such instructions were ineffective here. Thus, there was no
misjoinder, and the district court did not abuse its discretion
in denying the defendants’ severance motions.
D. Helton’s Brady claim
Next, defendant Helton argues that the government sup‐
pressed exculpatory evidence contained in documents from
Nos. 11‐3240, 12‐1207, 12‐1295 19
the bankruptcy case files that agents seized from his law of‐
fice during the fraud’s investigation. Helton says that this
was a Brady violation. He acknowledges that he never raised
this issue below, and as such, we can review only for plain
error. Regardless, the claim is plainly without merit. To es‐
tablish a Brady violation, Helton must show that the gov‐
ernment suppressed material exculpatory evidence. The
problem is that the government did not “suppress” the evi‐
dence Helton describes. The information he claims to have
sought was in his own case files, which the government says
were returned or otherwise made available to him well in
advance of trial. Despite Helton’s bare assertions to the con‐
trary, we have no reason to doubt the government’s credibil‐
ity on this point.6 And even if the files were not returned
promptly, Helton himself knew of the bankruptcy case files’
existence and whatever exculpatory potential they pos‐
sessed. This is not a situation where the government knew
something that he did not. See United States v. Lee, 399 F.3d
864, 865 (7th Cir. 2005) (“Brady v. Maryland deals with the
concealment of exculpatory evidence unknown to the de‐
fendant.” (internal citation omitted)). This claim also fails.
E. Government Exhibit 20908 – the summary chart
We now move on to evidentiary matters. The defendants
first object to the introduction of a government summary
6 To support its claim that the government returned the case files or oth‐
erwise made their contents available before trial, the government points
to three references to the confiscated case files—and their having been
made available to the defendants—in its pretrial motions on unrelated
matters.
20 Nos. 11‐3240, 12‐1207, 12‐1295
chart (“Government Exhibit 20908”), which listed, in spread‐
sheet form, 236 property sale transactions closed by Title
Zone, on behalf of EHNS, between March 2004 and Septem‐
ber 2006. (This chart becomes important again later, so we
will discuss its contents at some length.) The chart was based
on Title Zone’s files, which included documents like each
sale’s mortgage application and HUD‐1 settlement state‐
ments. The chart was prepared as follows: the government
had an accountant review all of the files—four bankers box‐
es’ worth—for EHNS transactions during this time period
(548 in total). The accountant first narrowed the pool down
to transactions in which (1) there was an equity payment to
EHNS of $15,000 or greater, and (2) the seller’s mortgage
payoff or payout was greater than $35,000. All 236 transac‐
tions that met these criteria were listed on the chart. From
there, the chart indicated whether each transaction had cer‐
tain objective characteristics. These included whether White
or EHNS had provided the down payment check; whether
the property’s buyer had bought multiple properties within
a short period of time; whether the loan officer was listed as
Larry Collier, Raymond Lewis, Kevin Smith, or Eric Smith
(which, as another witness testified, were White’s common
aliases); and whether the buyer listed one of White’s compa‐
nies as her employer on the loan application. The accountant
determined whether the transaction contained these charac‐
teristics by reviewing the underlying files. In all, 225 transac‐
tions had one or more of these characteristics.
“Trial courts have broad discretion to admit or exclude
evidence,” and we review a claim that the court wrongly
admitted evidence only for an abuse of this discretion. Unit‐
ed States v. Spiller, 261 F.3d 683, 689 (7th Cir. 2001). To resolve
this particular dispute, we find that we need to follow our
Nos. 11‐3240, 12‐1207, 12‐1295 21
sister circuits in clarifying the distinctions between the two
main ways that a party can summarize complex, volumi‐
nous documents at trial. See, e.g., United States v. Milkiewicz,
470 F.3d 390, 395–98 (1st Cir. 2006); United States v. Janati, 374
F.3d 263, 272–73 (4th Cir. 2004). First, a party can introduce
the information in a summary exhibit under Federal Rule of
Evidence 1006, in order to “to prove the content of volumi‐
nous writings … that cannot be conveniently examined in
court.” If admitted this way, the summary itself is substan‐
tive evidence—in part because the party is not obligated to
introduce the underlying documents themselves. See Janati,
374 F.3d at 273; Fed. R. Evid. 1006 (only requiring that the
underlying evidence be “available for examination or copy‐
ing, or both, by other parties at a reasonable time and place,”
or be subject to production in court upon order). Because a
Rule 1006 exhibit is supposed to substitute for the volumi‐
nous documents themselves, however, the exhibit must ac‐
curately summarize those documents. It must not misrepre‐
sent their contents or make arguments about the inferences
the jury should draw from them. See Milkiewicz, 470 F.3d at
396 (“The proponent must show that the voluminous source
materials are what the proponent claims them to be and that
the summary accurately summarizes the source materials.”).
The other option is a pedagogical chart admitted pursu‐
ant to the court’s “control over the mode … [of] presenting
evidence” under Federal Rule of Evidence 611(a). Rule
611(a) pedagogical summaries are meant to facilitate the
presentation of evidence already in the record. These sum‐
maries are not substantive evidence—instead, the summar‐
ies are meant to aid the jury in its understanding of evidence
that has already been admitted. Janati, 374 F.3d at 273. For
this reason, Rule 611(a) charts can be more one‐sided in their
22 Nos. 11‐3240, 12‐1207, 12‐1295
presentation of the relevant information. For instance, such
exhibits may “include witnesses’ conclusions or opinions,”
or “reveal inferences drawn in a way that would assist the
jury.” Id. Of course, admitting such pedagogical devices is
within the district court’s discretion. And when the district
court does admit a summary on the basis, it should instruct
the jury that such summaries are not evidence and are meant
only to aid the jury in its evaluation of other evidence. Id.
We agree with the First Circuit that
[t]he lines between these two types of sum‐
mary documents are easily blurred. A sum‐
mary that is admissible under Rule 1006 …
could properly be offered under Rule 611(a) if
the supporting material has been admitted into
evidence. Likewise, a chart that originally was
offered as a jury aid to assist with review of vo‐
luminous underlying documents already in ev‐
idence—and which accurately summarizes
those documents—alternatively could be ad‐
mitted under Rule 1006 if the court concluded
that the supporting documents could not be
examined conveniently in court.
Milkiewicz, 470 F.3d at 397. In this case, however, Govern‐
ment Exhibit 20908 was admitted as substantive evidence
and allowed to go into the jury room—so it could not have
been admitted as a Rule 611(a) pedagogical summary. See
Baugh ex rel. Baugh v. Cuprum S.A. de C.V., 730 F.3d 701, 705
(7th Cir. 2013) (“The general rule is that materials not admit‐
ted into evidence simply should not be sent to the jury for
use in its deliberations.”). But no matter: we are satisfied that
Nos. 11‐3240, 12‐1207, 12‐1295 23
the district court properly admitted the chart as a summary
under Rule 1006.
The summary fulfilled every requirement of Rule 1006.
The underlying Title Zone transaction documents were un‐
doubtedly voluminous: the files filled four banker’s boxes.
Those boxes were made available to the defendants and the
district court; in fact, the government introduced the docu‐
ments themselves into evidence. And the chart itself was
“representative”: it simply catalogued instances of objective
characteristics and added those instances together to create
totals. True, the chart did not include every single transac‐
tion performed by EHNS during the relevant period. Ac‐
cordingly, at the district court’s instruction, the government
indicated at the bottom of the spreadsheet that only 236 of
the 548 EHNS transactions were listed. Moreover, in the
course of three sidebar conferences dealing with the chart’s
admission, the district court took extensive steps to ensure
that the document contained no argumentative labels or
phrasing (for instance, the government could not refer to the
selected transactions as “bailouts” or describe the character‐
istics as “suspect”), and the court forbade the government
from using the chart’s preparer to explain the significance of
the characteristics on the spreadsheet or to explain to the ju‐
ry what inferences it should draw from it. See Milkiewicz, 470
F.3d at 398 & n.16 (finding that the district court exercised its
discretion with “meticulous care” when it took similar steps
to excise prejudicial content prior to a Rule 1006 summary’s
admission). Finally, to the extent that the defendants argue
that the chart did not contain other types of information that
they wished it did have—for instance, the spreadsheet did
not list the amount of the down payment that EHNS provid‐
ed for each transaction—the defendants were free to cross‐
24 Nos. 11‐3240, 12‐1207, 12‐1295
examine the spreadsheet’s creator to bring out that infor‐
mation. See United States v. Swanquist, 161 F.3d 1064, 1072–73
(7th Cir. 1998) (finding no abuse of discretion where the de‐
fendant “had ample opportunity during his cross‐
examination of [the document’s preparer] to elicit any facts
that might have suggested that the government’s charts in‐
correctly captured the nature of [the underlying docu‐
ments]”).
After going through the effort to admit the summary
chart under Rule 1006, the district court then instructed the
jury that the summary chart was “not evidence” and that it
was only admitted “to aid you in evaluating other evi‐
dence.” This instruction, however, was appropriate for a
Rule 611(a) summary, not a Rule 1006 summary—as dis‐
cussed above, Rule 1006 charts are most certainly evidence.
But in any event, the instruction inured to the defendants’
benefit. It is not a basis for reversal.
As such, we find that the district court was within its dis‐
cretion to admit Government Exhibit 20908.
F. Character evidence of Ford’s law‐abiding nature
Having found that the district court did not err in allow‐
ing certain evidence to come in, we now consider defendant
Ford’s claim that the court erred in keeping certain evidence
out.
Ford took the stand at trial. On redirect, Ford sought to
testify that she had cooperated in an FBI investigation of an
identity‐theft scheme during the relevant period. The FBI
had reached out to Ford because the suspect had used Title
Zone to close three loan transactions; when the suspect came
back to Title Zone for another transaction, Ford stopped the
Nos. 11‐3240, 12‐1207, 12‐1295 25
deal and contacted the FBI. At trial, Ford told the court that
she wanted to use this episode to show that she did not ig‐
nore fraudulent activity when she learned of it. The court
sustained the government’s objection. It ruled that evidence
of Ford’s cooperation in the investigation of an entirely dif‐
ferent fraud—a fraud in which she was not personally in‐
volved, and in which Title Zone was a victim—was unrelat‐
ed and could confuse the jury.
On appeal, Ford argues that she should have been al‐
lowed to testify about her cooperation with the FBI as evi‐
dence of her law‐abiding character under Rule 404(a)(2).
Federal Rule of Evidence 404(a)(2) lists exceptions to the
general prohibition against the use of character evidence: it
provides, inter alia, that in a criminal case “a defendant may
offer evidence of the defendant’s pertinent trait.” Fed. R.
Evid. 404(a)(2)(A). Ford maintains that her character for law‐
abidingness is pertinent to the crime charged. Even assum‐
ing she is right, she overlooks the fact that Rule 405 limits
the form such evidence can take. Under 405(a), admissible
character evidence may be introduced in the form of opinion
or reputation testimony. Specific instances of the defendant’s
character, on the other hand, may only be introduced if that
character “is an essential element of a charge, claim, or de‐
fense.” Fed. R. Evid. 405(b). Ford’s testimony about the time
that she tipped off the FBI is evidence about a specific in‐
stance of her character. And Ford’s law‐abidingness, or lack
thereof, is not an essential element of a wire fraud charge,
nor a defense to it. We find no abuse of discretion in the dis‐
trict court’s exclusion of this testimony.
26 Nos. 11‐3240, 12‐1207, 12‐1295
G. The multiple‐schemes instruction
At trial, Ford and the government each proposed a jury
instruction concerning the existence of multiple schemes to
defraud. These instructions were aimed at the possibility of
variance between the conduct charged in the indictment and
the conduct proven by the government at trial; under some
circumstances, such a variance can prejudice the defendant’s
right to a fair trial. See United States v. Miller, 471 U.S. 130,
134–36 (1985). Both Ford and the government’s proposed in‐
structions told the jury what to do if it found that the gov‐
ernment had proven a scheme other than the large, over‐
arching wire fraud scheme charged in the indictment. The
district court found that Ford’s proposed instruction incor‐
rectly stated the law regarding multiple schemes; the court
instead gave the government’s as Jury Instruction No. 24. On
appeal, Ford argues that the district court erred in refusing
her instruction and in giving the government’s.
When the defendant objects to the district court’s refusal
to give an instruction on her theory of defense, our review is
de novo. United States v. Vargas, 689 F.3d 867, 877 (7th Cir.
2012). But Ford is only entitled to her instruction if it is a cor‐
rect statement of the law. Id. We also review this question de
novo. United States v. Tanner, 628 F.3d 890, 904 (7th Cir.
2010).
Here, the district court was right to reject Ford’s pro‐
posed instruction. We have rejected essentially the same in‐
struction many times. See, e.g., United States v. Campos, 541
F.3d 735, 744–45 (7th Cir. 2008); United States v. Wilson, 134
Nos. 11‐3240, 12‐1207, 12‐1295 27
F.3d 855, 864–65 (7th Cir. 1998) (listing cases).7 We have
stressed that instructions like Ford’s are “always inappropri‐
7 Ford’s proposed instruction:
Count One to Seven of the indictment charges that
defendants knowingly and intentionally devised or par‐
ticipated in a scheme to defraud and in doing so defend‐
ants caused interstate wire communications to take place
in the manner charged in the particular Count of the In‐
dictment.
In order to sustain its burden of proof for this
charge, the government must show that the single mas‐
ter scheme alleged in Count One to Count Seven of the
indictment existed. Proof of separate or independent
schemes is not sufficient.
In determining whether or not any single scheme
has been shown by the evidence in the case you must
decide whether common, master, or overall goals or ob‐
jectives existed which served as the focal point for the ef‐
forts and actions of any members to the agreement. In
arriving at this decision you may consider the length of
time the alleged scheme existed, the mutual dependence
or assistance between various persons alleged to have
been its members, and the complexity of the goal(s) or
objective(s) shown.
Even if the evidence in the case shows that Defend‐
ants was/were a member of some scheme, but that this
scheme is not the single conspiracy charged in the in‐
dictment, you must acquit Defendants [of] this charge.
Unless the government proves the existence of the
single master scheme described in the indictment be‐
yond a reasonable doubt, you must acquit defendants of
these charges.
28 Nos. 11‐3240, 12‐1207, 12‐1295
ate as a matter of law,” because they tell the jury that it must
acquit if the government fails to prove the exact overarching
scheme charged in the indictment. Wilson, 134 F.3d at 864–
65. To the contrary, it is permissible for the government “to
proceed on a subset of the allegations in the indictment, prov‐
ing a conspiracy smaller than the one alleged, so long as that
subset is also illegal.” Id. at 865 (citation omitted) (emphasis
added). Thus, Ford was asking for a patently erroneous in‐
struction.
Further, the district court committed no error in giving
Instruction No. 24 instead.8 This multiple‐schemes instruc‐
8 Jury Instruction No. 24:
The indictment charges in Counts One through
Eight that the defendants participated in a single scheme
to defraud.
Proof that there were multiple schemes to defraud is
not necessarily proof of a single scheme to defraud, nor
is it necessarily inconsistent with the existence of a single
scheme to defraud.
If you do not find beyond a reasonable doubt that a
particular defendant devised or participated in a scheme
to defraud, you should find that defendant not guilty of
the respective counts.
If you find beyond a reasonable doubt that there
was one overall scheme to defraud as alleged in Counts
One through Eight, then you should find that defendant
of the respective count if each of the elements of the of‐
fense had been proved.
If you find beyond a reasonable doubt that there
were two or more schemes to defraud, you may find
that defendant guilty of the respective count only if you
Nos. 11‐3240, 12‐1207, 12‐1295 29
tion tells the jury that in the event that it finds that there
were two or more schemes to defraud, it may convict only if
the jurors “unanimously agree as to the particular scheme
that the government has proven and further find beyond a
reasonable doubt that the proven scheme to defraud was in‐
cluded within the scheme to defraud alleged in [the indict‐
ment].” The essence of this instruction has been approved in
our decisions, see United States v. Mansoori, 304 F.3d 635, 656–
57 (7th Cir. 2002); Wilson, 134 F.3d at 865, and the govern‐
ment appropriately modified it to require that the jury agree
as to which scheme the government proved, see United States
v. Davis, 471 F.3d 783, 791 (7th Cir. 2006). Ford complains
that Mansoori and Wilson involved drug conspiracies, while
the present case involves financial fraud. But she never ex‐
plains why this is a distinction that makes a difference, and
we do not see why it should. The underlying variance is‐
sue—that is, the requirement that the government charge in
the indictment what it intends to prove at trial—is the same
even if the nature of the crimes is different. Accordingly, we
find no error in the district court’s instructions.
unanimously agree as to the particular scheme that the
government has proven and further find beyond a rea‐
sonable doubt that the proven scheme to defraud was
included within the scheme to defraud alleged in Count
One through Eight.
30 Nos. 11‐3240, 12‐1207, 12‐1295
H. White’s sentencing
Satisfied that all three defendants received a fair trial, we
now proceed to defendant White’s contentions about his
sentence.
We review sentences for procedural error and substan‐
tive reasonableness. United States v. Carter, 538 F.3d 784, 789
(7th Cir. 2008). White challenges his sentence on both fronts.
Procedurally, he argues that the district judge failed to re‐
spond meaningfully to his arguments about the loss amount
enhancement, incorrectly calculated the loss amount under
U.S.S.G. § 2B1.1(b)(1), and wrongly applied the vulnerable
victim enhancement in U.S.S.G. § 3A1.1(b)(1). Substantively,
White argues that his sentence was greater than necessary to
provide specific deterrence and created unwarranted sen‐
tencing disparities between White and other fraud defend‐
ants. We review a district court’s interpretation and applica‐
tion of the guidelines de novo and its findings of fact for
clear error. United States v. Natour, 700 F.3d 962, 975 (7th Cir.
2012).
1. The loss amount
White’s presentence report, in accordance with the gov‐
ernment’s calculation, recommended that White receive a
twenty‐level enhancement because EHNS’s mortgage
bailout scheme caused a loss greater than $7 million but less
than $20 million. See U.S.S.G. § 2B1.1(b)(1)(K). (Actual loss,
which is what the government proved here, is defined as
“the reasonably foreseeable pecuniary harm that resulted
from the offense.” Id. § 2B1.1, application note 3(A).) The
government attributed about $9 million of loss to the mort‐
gage lenders from the loans EHNS arranged between March
Nos. 11‐3240, 12‐1207, 12‐1295 31
2004 and September 2006.9 The government’s addendum in‐
cluded losses sustained by mortgage lenders with respect to
the 225 properties that had been identified in Government
Exhibit 20908 (the summary chart) as fraudulent mortgage
bailout transactions. As discussed above, these 225 transac‐
tions were so identified because EHNS received at least
$15,000 from the sale, the prior mortgagee received a pay‐
ment of at least $35,000, and the transaction itself had one or
more suspect characteristics (for example, the loan applica‐
tion had been prepared by one of White’s aliases). The gov‐
ernment determined that lenders had recovered fully on 77
of these properties. 102 of these properties, however, had al‐
ready gone through foreclosure; the government calculated
the loss as the balance of the unpaid principal at the time of
foreclosure, less the amount the lender recouped on resale.
For the 102 foreclosed properties, this figure totaled
$8,532,707. The government applied a 10% margin of error to
put the final estimate for the 102 foreclosed properties at
$7,679,436. There were 46 remaining properties without a
final disposition; for nine of them, the government deter‐
mined that it had insufficient information to determine
whether the lender would incur a loss. For the other 37, the
government knew that the properties had entered foreclo‐
sure proceedings; the government thus estimated these fu‐
ture losses by multiplying the unpaid principal of all 37
9 The indictment only charged the defendants with conduct between
August 2004 and September 2005; however, U.S.S.G. § 1B1.3(a)(2) allows
the court to include loss caused by conduct relevant to, but not specified
within, the counts of conviction. United States v. Locke, 643 F.3d 235, 243
(7th Cir. 2011).
32 Nos. 11‐3240, 12‐1207, 12‐1295
loans by the rate of loss of the 102 foreclosed properties
(51%). This figure came to another $3,014,583; the govern‐
ment applied a 50% margin of error to get a final estimate of
$1,507,291 in future losses. In sum, then, the government cal‐
culated the loss amount as $9,186,727. Notably, the govern‐
ment did not include any losses to the EHNS clients—the $9
million figure was based solely on losses sustained by the
mortgage lenders.
White raised several arguments contesting this calcula‐
tion. For instance, he argued that 40 of the transactions listed
in the chart did not appear to be bailout transactions, that
most of the mortgages had gone on the secondary market
and there was no way to tell whether the final noteholder
had taken a loss, and that the figures from the foreclosure
sales were unreliable. On appeal, White argues that the dis‐
trict court’s responses to these arguments were so insuffi‐
cient as to be procedurally unreasonable. See Natour, 700
F.3d at 974 (a district court can commit error by not ade‐
quately explaining its sentencing determinations). White
complains that after the parties presented argument on the
loss issue, the district court’s analysis was nonresponsive
and merely adopted the government’s calculations “whole‐
sale.”
It is true that the district court did not go into great depth
in addressing the merits of White’s loss‐calculation argu‐
ments. The following is the entirety of the court’s own anal‐
ysis of the loss issue:
There has been an addendum filed by the gov‐
ernment with the charts and government’s cal‐
culations basically relate specifically to certain
transactions and the Court agrees with the
Nos. 11‐3240, 12‐1207, 12‐1295 33
government’s calculations are, in fact, based on
a conservative estimate of the loss amount.
There is [no] exact formula as to the loss
amount and the Court makes the calculations
based on best estimates. And although the de‐
fendant continues to deny that the fraud was
committed and continues to try and deflect the
responsibility for losses, the government has
pointed to reliable evidence that its loss
amount calculation is correct. Thus, the 20‐
point enhancement for the loss amount calcu‐
lated in the PSR is appropriate.
We recently reversed a district court’s sentence on this
basis in United States v. Leiskunas, 656 F.3d 732 (7th Cir. 2011).
Leiskunas also concerned a defendant who committed mort‐
gage fraud (albeit as a straw buyer), and the government
had also alleged loss based on the difference between the
loan amount and what the lender recouped in a foreclosure
sale. Id. at 733–35. The defendant argued that this amount
was not reasonably foreseeable to him because he did not
know the property would go through foreclosure; the dis‐
trict court did not discuss this objection at all before adopt‐
ing the PSR’s calculation. Id. at 736, 738. “[B]ecause of the
court’s silence,” we held, “we cannot be sure of the effect
that Leiskunas’s argument had, or could have had, on the
court’s sentencing decision.” Id. at 738.
However, Leiskunas is distinguishable. In our case—when
we evaluate the entirety of the sentencing transcript and re‐
view the district court’s conclusions in context—the court
made sufficient findings for us to meaningfully review its
decision. See Natour, 700 F.3d at 977 (finding no error on this
34 Nos. 11‐3240, 12‐1207, 12‐1295
basis when, “reading the sentencing procedure as a whole,”
we were satisfied that the district court adequately explained
its reasoning). First, the paragraph quoted above comprised
the entirety of the district court’s own analysis of the loss,
but not the entirety of its discussion on the subject. Before
issuing its decision, the district court summarized each of
the defendant’s specific loss‐calculation arguments and the
government’s response. In doing so, the court diligently—
and fairly—relayed the gist of each of White’s contentions,
even if the court did not editorialize upon their merit. This
distinguishes our case from Leiskunas, where “the district
court provided no reasoning whatsoever for a loss amount.”
Id. (also distinguishing the facts of Leiskunas). Unlike Leisku‐
nas, we know from the record that the district court was
keenly aware of the defendant’s arguments—and when the
district court adopted the government’s calculation in the
face of such arguments, we can surmise what little persua‐
sive effect they had.
White also argues that the district court failed to make an
explicit finding that the post‐September 2005 transactions
(that is, the uncharged conduct) constituted relevant conduct
for the purposes of loss. We have said that the relevant‐
conduct determination should be expressly stated by the dis‐
trict court during the hearing. See, e.g., United States v. Ojo‐
mo, 332 F.3d 485, 489 (7th Cir. 2003). But we have also said
that we will not reverse a sentence on this basis “where it is
clear from the record that the district court considered and
adopted the facts recited in the presentence report, as well as
the government’s reasoning concerning the significance of
those facts in establishing the defendant’s responsibility for
uncharged conduct.” United States v. Acosta, 85 F.3d 275, 280
(7th Cir. 1996) (affirming a sentence where the district
Nos. 11‐3240, 12‐1207, 12‐1295 35
court’s relevant conduct finding was “implicit”); see also
United States v. Locke, 643 F.3d 235, 244–45 (7th Cir. 2011)
(listing cases where we overlooked “a paucity of explicit
findings by the sentencing judge” because there was “specif‐
ic, objective evidence in the record” that such findings were
warranted).
Here, the district court stated that “the PSR properly re‐
flects a total offense level of 39,” thereby adopting the PSR’s
findings. The court also stated that the government had put
forth “reliable evidence to show by a preponderance of the
evidence that its loss amount calculation was correct,” and
that the government had “related” its calculations to “certain
transactions.” More importantly, the court referred specifi‐
cally to the government’s summary chart. The court was
very familiar with the contents of the chart due to the con‐
troversy about the summary’s admission at trial; specifically,
the court was familiar with the significance of the character‐
istics listed on the spreadsheet. Under these circumstances,
we will not set aside the sentence because the court did not
make the relevant conduct finding explicitly. See Acosta, 85
F.3d at 280; United States v. Wilson, 502 F.3d 718, 723 (7th Cir.
2007) (“That the court failed to invoke the specific phraseol‐
ogy of U.S.S.G. § 1B1.3(a)(2) does not mean it failed to make
the necessary finding.”).
White also takes issue with the loss calculation itself. He
reiterates many of the arguments that he raised at sentenc‐
ing—that the government included some transactions that
he claims were not bailout transactions, that foreclosure data
is inherently unreliable, and that the numbers do not show
36 Nos. 11‐3240, 12‐1207, 12‐1295
the price that the secondary lenders paid for the mortgag‐
es.10 But the district court need only make “a reasonable es‐
timate of the loss” in applying the enhancement. U.S.S.G. §
2B1.1, application note 3(C). We review the district court’s
factual findings for clear error, reversing only when we are
“left with the definite and firm conviction that a mistake has
been made.” United States v. Cruz‐Rea, 626 F.3d 929, 938 (7th
Cir. 2010). Thus, on appeal, a defendant must “show that the
court’s loss calculations were not only inaccurate but outside
the realm of permissible computations.” United States v. Love,
680 F.3d 994, 999 (7th Cir. 2012) (citation and quotation
marks omitted).
Given this standard, White’s claim is unpersuasive. First,
White provided no support for his assertion that forty of the
transactions in the government’s chart were not bailout
transactions—he only gave the district court a list. He has
not provided anything more compelling on appeal. Next, the
government’s definition of loss—the difference between the
foreclosure price and the outstanding balance on the loan—
is reasonable and indeed, frequently used in cases involving
fraudulent mortgages. See, e.g., United States v. Smith, 705
F.3d 1268, 1276 (10th Cir. 2013) (approving of such method‐
ology “[a]s a general matter”). Further, the government’s es‐
timate of $9 million was likely conservative. The government
10 White also insists that the government’s loss figure did not take into
account the mortgage payments that EHNS made on behalf of investors
for the year‐long period following the sale. But the government calculat‐
ed loss based on the difference between the property’s resale price and
the loan’s unpaid principal. That formula necessarily takes into account
the amount of the loan that was paid, either by EHNS or others.
Nos. 11‐3240, 12‐1207, 12‐1295 37
did not include properties for which it did not have suffi‐
cient data to conclude that the properties would be sold for a
loss. The government also discounted both the total for the
foreclosed properties and the soon‐to‐be‐foreclosed proper‐
ties, the latter with a generous margin of error. Moreover,
the total figure did not include losses to the deceived EHNS
clients. The government only had to cross the $7 million
threshold to establish the enhancement’s applicability—the
district court’s calculation is not “outside the realm of per‐
missible computations.”
2. The vulnerable victim enhancement
White also challenges the district court’s application of
the vulnerable victim enhancement. U.S.S.G. § 3A1.1(b)(1)
instructs the sentencing judge to increase the offense level “if
the defendant knew or should have known that a victim of
the offense was a vulnerable victim.” The application notes
define “vulnerable victim” as a person “who is a victim of
the offense of conviction and any conduct for which the de‐
fendant is accountable,” and “who is unusually vulnerable
due to age, physical or mental condition, or who is otherwise
particularly susceptible to the criminal conduct.” Only one
victim of the scheme need qualify for the enhancement to
apply. United States v. Sims, 329 F.3d 937, 944 (7th Cir. 2003).
Our court recently addressed who counts as a vulnerable
victim in the context of a mortgage bailout scheme in United
States v. Johns, 686 F.3d 438, 457–60 (7th Cir. 2012). As Johns
controls White’s challenge, an extended summary is helpful.
In Johns, the defendant participated in a “rinsed equity”
scheme: Johns and his partner, Banks, would purchase
homes from their owners at highly inflated prices. As a con‐
dition of the sale, the homeowners had to promise to return
38 Nos. 11‐3240, 12‐1207, 12‐1295
to Johns and Banks any proceeds in excess of what the
homeowner owed to their original mortgage lender. “In es‐
sence, Johns and Banks were manufacturing equity, then
demanding it back from the homeowners.” Id. at 441. In the
transaction that led to Johns’ indictment, the homeowners,
the Ten Hoves, were already in Chapter 13 proceedings and
were facing a sheriff’s sale of their home. The Ten Hoves
sold their home to Banks, and Johns used some of the rinsed
equity to pay off the Ten Hoves’ other creditors in full. In the
end, the Ten Hoves were able to avoid foreclosure and walk
away from the sale without any outstanding debt, even
though they retained none of the home’s equity. Id. at 443–
44. The district judge also considered two of Johns’ other
rinsed‐equity transactions as relevant conduct. One transac‐
tion, involving a homeowner named Coleman, was very
similar in circumstances to the Ten Hoves, including the fact
that Coleman’s “only other option” was foreclosure. Id. at
445. The third sale involved the Spellers, who were also fac‐
ing foreclosure. Id. at 445. But unlike the Ten Hoves and
Coleman, the Spellers had not been under the impression
that they were selling their home outright. The record indi‐
cated that the Spellers thought that the equity created by the
sale would be used only to pay their mortgage and taxes for
some period of time, and then they would reacquire the
property. Id. at 457.
In Johns, we broke the § 3A1.1(b)(1) analysis into two
separate questions: one, were these homeowners vulnerable,
and two, were they actually victims of the defendant’s of‐
fense or other relevant conduct? Id. at 458. With regard to the
second question, we held that individuals can be victims on‐
ly if they “experienced some actual or intended harm.” Id. at
460. The government argued that all of the homeowners
Nos. 11‐3240, 12‐1207, 12‐1295 39
were harmed because the rinsed‐equity transactions
stripped their homes of potential equity and transferred it
wrongfully to Johns and Banks. We disagreed. Noting that
the district court had found that the Ten Hoves and Cole‐
man were already facing foreclosure at the time of the trans‐
actions, we reasoned that if they had instead gone through
with the forced sales, there would have been no equity for
them to lose. Id. at 455–56. In addition, we found that the
rinsed‐equity transactions actually made the Ten Hoves and
Coleman better off in that they avoided foreclosure, were
guaranteed to receive enough cash to pay off their lenders,
and—in the case of the Ten Hoves—were able to exit bank‐
ruptcy quickly. Id. at 456. By contrast, we could not conclude
from the district court’s findings whether the Spellers were
similarly made better off. Id. at 457. Although the Spellers
were also in foreclosure, the district court nonetheless stated
that the Spellers may have had some equity in their home.
Id. We speculated that “the district court may [have be‐
lieved] that the Spellers were duped into giving up the equi‐
ty they had in their house (which could have been accessed
through a forced sale) in order to gain the advantages pro‐
posed by Johns and Banks—an option to repurchase and eq‐
uity used for their benefit.” Id. Thus, unable to conclude
whether the Spellers suffered financial loss, we remanded
the issue. Id.
The district court sentenced White without the benefit of
Johns, which was decided the following year. As a result, the
court’s factual findings on the matter—and the govern‐
ment’s proof—were not as explicit as we might prefer going
forward. Nonetheless, we find no error in the district court’s
identifying the EHNS homeowners as vulnerable victims.
40 Nos. 11‐3240, 12‐1207, 12‐1295
First, the EHNS clients were “vulnerable” under the
standard set out in Johns. There, we squarely held that “fi‐
nancial desperation is enough to make one vulnerable to fi‐
nancial crimes,” and noted that the fact that the homeowners
“were in a position to lose their home at the time of their
transaction” sufficed to find them financially desperate. Id.
at 460. Here, the district court found that multiple home‐
owners were facing foreclosure at the time they entered into
EHNS’s program. And the court noted that “victim after vic‐
tim took the stand and testified relating to how desperate
they were and how the defendant … took advantage of these
individuals with the false promise of saving their houses
when he, in fact, knew that at the end their houses will not
be salvaged.” There is plenty of witness testimony in the
record to support the court’s characterization.11
The second question is whether the homeowners “would
have been in a better financial position but for” EHNS. Johns,
686 F.3d at 456. As discussed above, the district court needed
to find that at least one homeowner suffered actual financial
harm as a result of her participation in the bailout program.
The court did so find: it concluded that White “took ad‐
vantage of [the homeowners’] vulnerability and put them
more in the hole than they would have been had he not taken ad‐
11 The district court also found that some homeowners could be consid‐
ered vulnerable on account of their being churchgoers that White target‐
ed by appealing to their religion. As mentioned above, “Eyes Have Not
Seen” is a reference to a biblical verse, and EHNS advertised on gospel
radio stations. Given that these homeowners could be found vulnerable
on the basis of their financial desperation alone, however, we express no
opinion on the court’s finding vulnerability on the basis of their religion.
Nos. 11‐3240, 12‐1207, 12‐1295 41
vantage of them.” (emphasis added). The trial record sup‐
ports this finding. For one, although White (like the defend‐
ant in Johns) often manufactured the equity that EHNS drew
out of these properties, there was evidence that in some in‐
stances, the program stripped homeowners of equity that
would have been rightly theirs. Some EHNS properties were
appraised at amounts yielding equity in excess of $60,000—
given that White usually pressured appraisers to inflate their
equity estimate only to $30,000 or so, it stands to reason that
those $60,000+ properties actually had some value to lose.
Indeed, some of the straw purchasers were later able to sell
their properties at a profit. Further, there was evidence that
the EHNS program damaged clients’ financial health. For
instance, one client testified that she ended up owing more
in rent payments to her home’s purchaser than she had orig‐
inally been paying in monthly mortgage payments. And of
course, at EHNS’s urging, many homeowners filed for bank‐
ruptcy—thereby further damaging their credit.
White insists that, like the Ten Hoves and Coleman in
Johns, all of the EHNS clients would have ended up losing
their homes anyway. But the EHNS homeowners were more
akin to the Spellers than to the Ten Hoves and Coleman.
Like the Spellers, many of the EHNS clients were “duped”
into giving up their homes—they did not make an informed
choice to sell. Even if the homeowners might have ended up
in foreclosure absent the EHNS sale, White and his co‐
defendants deprived them of the opportunity to recover eq‐
uity or explore other options that might have saved their
home.
For these reasons, we find no error in the district court’s
applying the vulnerable victim enhancement.
42 Nos. 11‐3240, 12‐1207, 12‐1295
3. The substantive reasonableness of the sentence
Finally, White challenges his sentence’s reasonableness.
After applying the enhancements discussed above and oth‐
ers, the court calculated a total offense level of 39 and a crim‐
inal history category of I. The resulting advisory guidelines
range was 262 to 327 months imprisonment; the court sen‐
tenced White to 266 months. We apply a presumption of rea‐
sonableness to all within‐guidelines sentences. See Rita v.
United States, 551 U.S. 338, 347 (2007); United States v. Jack‐
son, 547 F.3d 786, 792 (7th Cir. 2008).
White cannot overcome this presumption. He first con‐
tends that courts routinely depart downward from the
guidelines when it comes to fraud sentences, and therefore
the district court created an unwarranted sentencing dispari‐
ty when it issued a sentence within the guidelines range. See
18 U.S.C. § 3553(a)(6). But even if White were right about
there being “near unanimity” that the guideline ranges for
fraud offenses are too high—a premise that we question—
we have repeatedly held that a within‐guidelines sentence
necessarily takes into account unwarranted disparities. See,
e.g., United States v. Matthews, 701 F.3d 1199, 1205 (7th Cir.
2012). This is because “the ranges are themselves designed to
treat similar offenders similarly.” United States v. Boscarino,
437 F.3d 634, 638 (7th Cir. 2006). Indeed, we have noted that
imposing a within‐guidelines sentence is the surest way to
avoid unwarranted disparities. United States v. Babul, 476 F.3d
498, 501–02 (7th Cir. 2007).
White also argues that his sentence is greater than neces‐
sary to achieve specific deterrence. See 18 U.S.C.
§ 3553(a)(2)(C). But the district court found that although
this was White’s first serious conviction, White had previ‐
Nos. 11‐3240, 12‐1207, 12‐1295 43
ously committed several crimes, including theft and making
false statements on a credit card application. The court also
highlighted White’s failure to acknowledge his wrongdoing
and reasoned that a significant sentence was necessary to
promote White’s respect for the law. See id. § 3553(a)(2)(A).
Further, the court emphasized the seriousness of mortgage
fraud offenses in undermining the integrity of financial insti‐
tutions. See id.
Overall, the district court gave meaningful consideration
to the § 3553(a) factors and thoroughly explained its reasons
for rejecting White’s mitigating arguments. White has not
rebutted the presumption that his within‐guidelines sen‐
tence is reasonable.
III. Conclusion
We AFFIRM the convictions and sentences of the three de‐
fendants.