United States Court of Appeals,
Eleventh Circuit.
No. 95-4207
Non-Argument Calendar.
UNITED STATES of America, Plaintiff-Appellee,
v.
Fernand TOUSSAINT, Defendant-Appellant.
June 12, 1996.
Appeal from the United States District Court for the Southern
District of Florida. (No. 94-0305 CR-SH), Shelby Highsmith, Judge.
Before TJOFLAT, Chief Judge, and KRAVITCH and COX, Circuit Judges.
TJOFLAT, Chief Judge:
Fernand Toussaint appeals his convictions for conspiracy to
make materially false statements to the Small Business
Administration ("SBA") in violation of 18 U.S.C. § 371 (Count I),
and for making false statements to the SBA in violation of 18
U.S.C. § 1001 (Count II). He also appeals the sentences he
received.1 We affirm.
I.
Toussaint seeks a new trial on both counts of the indictment
because the district court, in charging the jury on the elements of
the alleged offenses, failed to instruct the jury that it could not
convict appellant of either offense unless it found that the false
statements he allegedly made to the SBA were "material." See
United States v. Gaudin, --- U.S. ----, ----, 115 S.Ct. 2310, 2320,
1
Toussaint received concurrent 30-month prison sentences, to
be followed by two concurrent three-year terms of supervised
release, and was ordered to pay a $5,000 fine ($2,500 per count)
and a $100 assessment.
132 L.Ed.2d 444 (1995). Toussaint did not object at trial to the
court's failure to submit the materiality issue to the jury;
accordingly, we review for plain error. See United States v.
Kramer, 73 F.3d 1067, 1074 (11th Cir.1996). In short, Toussaint
must demonstrate that the district court's failure to submit the
issue of materiality to the jury "affected his substantial rights
(that is, affected the outcome of his trial)." Id.
Gaudin does not apply to the Count I offense; materiality is
not an element of a section 371 offense. Moreover, regardless of
whether materiality is an element of a section 371 or a section
1001 offense, we conclude that Toussaint has failed to show that
the failure to submit the issue of materiality to the jury affected
the outcome of his trial. The statements in question were made by
Toussaint in a disaster loan application to the SBA. Toussaint
stated that he had suffered physical losses of over $360,000 as a
result of damage caused by Hurricane Andrew; in fact, Toussaint
had suffered no losses. Had the SBA believed his false
representations, it would have given Toussaint a disaster loan in
an amount in excess of $360,000. The materiality of Toussaint's
statements was self-evident, uncontested, and unrefuted. We have
no doubt that the jury would have found the statements material,
had it been called upon to decide the issue. In sum, there is no
plain error in this case.
II.
Toussaint's scheme was uncovered while his loan application
was being processed; hence, the SBA suffered no actual loss. The
district court, however, found that Toussaint fully intended that
a loss occur—that is, Toussaint had no intention of paying off the
loan. At sentencing, the court stated:
This Court has observed on more than even several occasions in
recent months that this nation is sorely beset with this type
of fraud. For the record, I do not find the explanation of
the defendant credible. I did not find his explanation during
the course of trial ... credible. I am in full accord with
the verdict of the jury.... Mr. Toussaint, I do not accept
your explanation that you never intended to impose some sort
of fraud upon the government of the United States. I think
that was your intention from the very beginning.
Accordingly, the district court increased Toussaint's base offense
levels by nine levels because Toussaint intended that the SBA incur
a loss in the amount of the contemplated disaster loan. See
U.S.S.G. § 2F1.1(b)(1)(J) (1995).2
Toussaint contends that unless a loss has actually occurred,
a sentencing court is precluded from considering any loss that he
may have intended. As Toussaint states in his reply brief, an
"offense adjustment [under section 2F1.1, see § 2F1.1 comment. (n.
7) (1995) ] depends solely on ... whether certain dollar amounts
were lost. It is only after eligibility for an offense adjustment
based on some actual dollar loss has been established that intended
harm in excess of that amount may be considered." We disagree.
The district court's interpretation of the Sentencing
Guidelines is a question of law which we review de novo. United
States v. Goldberg, 60 F.3d 1536, 1538-39 (11th Cir.1995). The
calculation of amount of loss for sentencing purposes is a factual
2
U.S.S.G. § 2F1.1(a) sets the base offense level at 6 for
crimes involving fraud and deceit. In addition to the 9-point
increase for the amount of loss intended, the court added two
points to the base offense level because the offense required
more than minimal planning, see § 2F1.1(b)(2)(A). Toussaint's
total offense level was thus 17.
determination reviewable for clear error. United States v.
Menichino, 989 F.2d 438, 440 (11th Cir.1993).
The commentary to section 2F1.1 instructs that "[i]n
fraudulent loan application cases ... the loss is the actual loss
to the victim (or if the loss has not yet come about, the expected
loss).... [W]here the intended loss is greater than the actual
loss, the intended loss is to be used." U.S.S.G. § 2F1.1, comment.
(n. 7) (1995). Nowhere does the commentary require or even suggest
that some actual loss must occur before any intended loss may be
considered. In fact, the plain language indicates that the
contrary is true. It strikes us as improper to reward a defendant
with a lesser punishment because of the fortuity that he was caught
before he was able to cause the victim to suffer the loss. The
fact that no loss occurred is immaterial to the inquiry of whether
Toussaint intended to keep the loan amount; it is this intent,
whether or not brought to fruition, that the enhancement is meant
to address.
Our precedent also dictates this conclusion. In United States
v. Menichino, 989 F.2d 438 (11th Cir.1993), the defendant obtained
a fraudulent appraisal for his power boat. An undercover agent who
was to purchase the boat had asked Menichino to procure a higher
appraisal value so that the agent could then use it to secure a
loan from a bank. Despite that no loan was ever issued and that
therefore "there was no actual loss," id. at 442, we found that the
district court properly enhanced Menichino's sentence under section
2F1.1.3
The district court found that Toussaint intended to pocket the
entire amount of the loan. This finding is supported by the
evidence, and is not clearly erroneous. Because Toussaint intended
that the government sustain a loss in the amount of the loan he was
seeking from the SBA, it was proper for the district court to
consider the full amount of the prospective loan as the "loss" for
purposes of section 2F1.1.
AFFIRMED.
3
There was no evidence in Menichino that the defendant
believed the loan would never be repaid. The district court
instead justified the enhancement on the ground that "[p]roof
that the defendant intentionally induced a bank to unknowingly
subject itself to the risk of default is sufficient to establish
that the defendant intended to cause a loss." Id. at 442.
Counsel for Toussaint attempts to distinguish Menichino because
"this form of loss calculation does not apply when, in cases such
as this, the purpose of the loan is for disaster relief and the
loan is made by a government agency precisely because the risk
exposure is one which would not be assumed by a private lender."
Even assuming this is true, we are not relying on Menichino for
the manner in which it calculates losses; rather, the district
court's enhancement in this case was based on the more basic
proposition that the defendant never intended to pay back the
loan, and thus the loan amount is the loss. Menichino does
support the proposition that irrespective of the manner in which
intended loss is calculated, it may form the basis of an
enhancement even in the complete absence of actual loss.