United States v. Fuentes

United States Court of Appeals,

Eleventh Circuit.

No. 94-4916.

UNITED STATES of America, Plaintiff-Appellee,

v.

Jose FUENTES, Defendant-Appellant.

March 25, 1997.

Appeal from the United States District Court for the Southern
District of Florida. (No. 93-256-CR-SM), Stanley Marcus, District
Judge.

Before TJOFLAT, Circuit Judge, and RONEY and PHILLIPS*, Senior
Circuit Judges.

TJOFLAT, Circuit Judge:

In this appeal, Jose Fuentes challenges the sentence he

received in the district court, following a plea of guilty, for

conspiring to run a "chop shop" operation.1 Pursuant to this

operation, Fuentes had stolen several Porsche automobiles, had

taken them to different locations where he removed many of their

parts, and after removing or altering the parts' vehicle

identification numbers ("VINs"), had sold the parts to customers

throughout the country. Prior to this federal prosecution, Fuentes

had been convicted in state court for some of this activity, and at

the time of his conviction in the district court, he was serving

two concurrent state sentences. The district court sentenced him

*
Honorable J. Dickson Phillips, Jr., Senior U.S. Circuit Judge
for the Fourth Circuit, sitting by designation.
1
A "chop shop" operation involves dismantling stolen
automobiles and selling their parts. See infra note 4 (citing
statutes prohibiting this conduct). Hereinafter, we refer to this
criminal activity as "chopping" automobiles.
to a term of sixty months imprisonment consecutive to his two state

sentences and ordered him to pay restitution.

In this appeal, Fuentes challenges the court's determination

under the federal sentencing guidelines that the federal sentence

should run consecutively to the state sentences. He also claims

that the order of restitution was erroneous in light of his

financial condition. We agree with him on both points and

accordingly vacate his sentence and remand for resentencing.

I.

Fuentes has a long criminal history.2 From his eighteenth

birthday in 1976 until 1984, he was arrested at least seven times

and convicted five times for various crimes, including battery,

carrying a concealed firearm, drug possession, and grand theft.

Beginning in May 1985, his criminal endeavors focused on

stealing Porsche automobiles and either selling them intact or

stripping them and selling their parts. From May 1985 until

January 1986, he stole or attempted to steal at least four

different Porsches. He was arrested and convicted of crimes

relating to this activity in four separate prosecutions in the

Circuit Court for Dade County, Florida. These cases were

consolidated for sentencing, and he was sentenced to prison for

seven years. He was released when these sentences expired in March

2
We derive the following factual account from the presentence
report ("PSR") prepared by the district court's probation office.
Neither Fuentes nor the Government objected to the factual findings
contained in the PSR, and the sentencing court therefore adopted
them as its own findings of fact. See Fed.R.Crim.P. 32(b)(6)(D).

2
1988.

Far from being rehabilitated, Fuentes returned to stealing

Porsches and, over time, increased his efforts to make a living

running chop shops in South Florida. In August 1989, he stole a

Porsche from a shopping center parking lot, brought it to a chop

shop, stripped it, removed the VINs, and sold the parts. In June

1990, he chopped another Porsche stolen from the same location.

His chop-shop operations hit stride in 1991. In February, he stole

a Porsche from a residence and chopped it in a friend's shed. In

March and April, he sold parts from three different Porsches to two

friends. The VINs had been ground off, and further details about

these three thefts are unknown. In the summer of 1991, he rented

two warehouses from which to operate his illegal enterprise.

During this time, he stole at least twelve Porsches from

locations—frequently, but not exclusively, doctor's offices and

hospitals—in Miami, Fort Lauderdale, and West Palm Beach. He

brought the Porsches to one of the two warehouses and chopped them

there. He stole one in June, one in July, four in August, three in

September, one in October, and two on unknown dates.

Fuentes sold the stolen parts to bona fide purchasers and to

co-conspirators who were aware the parts were stolen. He

distributed flyers listing available parts to repair shops and

parts stores in the Miami area. He also marketed the parts

nationwide, advertising in the classified section of Hemmings Motor

News. He included his beeper number in the flyers and
advertisements.

3
 At some point, both state and federal law enforcement

officials became aware of Fuentes' activities. The Metro-Dade

Police Department arrested him in August 1990 for the two thefts in

1989 and 1990, and they arrested him again in October 1991 for the

February 1991 theft.3 After each arrest, he was charged by

information in the Circuit Court for Dade County, Florida. After

Fuentes pled nolo contendre in both state cases, that court

sentenced him on March 11, 1992, to a total term of imprisonment of

twelve years.

On June 4, 1993, a grand jury for the Southern District of

Florida indicted Fuentes for his chop shop activities. On April

29, 1994, it returned a superseding indictment, which is now before

us. The indictment contained seven counts. Count one charged

Fuentes with conspiracy, in violation of 18 U.S.C. § 371, to alter

VINs in violation of 18 U.S.C. § 511(a) and to possess with intent

to dispose of motor vehicles and parts with altered VINs in

violation of 18 U.S.C. § 2321.4 The grand jury alleged that this

conspiracy lasted "[f]rom an unknown date until on or about October

3
Hereinafter we refer to the three Porsches involved in the
state cases as the "state Porsches."
4
Section 371 makes it a crime for "two or more persons [to]
conspire ... to commit any offense against the United States." 18
U.S.C. § 371 (1994). Section 511(a) prohibits "knowingly
remov[ing], obliterat[ing], tamper[ing] with, or alter[ing] an
identification number for a motor vehicle or motor vehicle part."
18 U.S.C. § 511(a)(1) (1994). Section 2321 provides for punishment
for anyone who "buys, receives, possesses, or obtains control of,
with intent to sell or otherwise dispose of, a motor vehicle or
motor vehicle part, knowing that an identification number for such
motor vehicle or part has been removed, obliterated, tampered with,
or altered." 18 U.S.C. § 2321(a) (1994).

4
21, 1991." Counts two through seven charged Fuentes with

substantive violations: five counts under section 2321 and one

count under section 511(a).

Fuentes entered into a written plea agreement and, on June 13,

1994, pleaded guilty to count one, the conspiracy count. The

district court accepted the guilty plea and, pursuant to the plea

agreement, dismissed the remaining six substantive counts of the

indictment.

The court then directed its probation office to prepare a PSR.

In describing the offense conduct underlying this conviction, the

PSR accounted for all the stolen Porsches described above, except

the three state Porsches.5 On August 29, 1994, the court sentenced

Fuentes to a term of imprisonment for sixty months (the maximum

prison sentence authorized for the conspiracy offense), to run

consecutively to the two undischarged state sentences, and three

years of supervised release. The court also ordered Fuentes to

make restitution in the amount of $357,281. After sentencing,

Fuentes was returned to the custody of the State of Florida to

serve the remainder of his undischarged state sentences.

Fuentes now appeals from his sentence claiming that under the

sentencing guidelines his sentence should run concurrently to the

undischarged state sentences and that the order of restitution was

improper because the district court "found as fact that Fuentes is

indigent and not capable of making restitution in the full amount."

5
Hereinafter we refer to the Porsches involved in the instant
prosecution as the "federal Porsches."

5
We agree and therefore vacate his sentence. We address the merits

of his arguments in turn.

II.

Fuentes first claims that the district court erred in

ordering that his sentence run consecutively to his undischarged

state sentences. The Sentencing Reform Act of 1984 grants district

courts discretion to order that a sentence run concurrently or

consecutively to an undischarged term of imprisonment. See 18

U.S.C. § 3584(a) (1994).6 In exercising this discretion, the court

6
Before the enactment of the Sentencing Reform Act of 1984, it
was widely held that a district court lacked the authority to order
a federal sentence to run concurrently with an undischarged state
sentence. See, e.g., Meagher v. Clark, 943 F.2d 1277, 1283 (11th
Cir.1991) ("[F]ederal jail time [may] be computed only to include
such time that the prisoner has served in confinement for the
federal offense involved.").

This rule was based on now-repealed 18 U.S.C. § 3568,
which provided that a "sentence of imprisonment ... shall
commence to run from the date on which [the prisoner] is
received at the penitentiary, reformatory, or jail for service
of such sentence.... No sentence shall prescribe any other
method of computing the term." 18 U.S.C. § 3568 (1982)
(emphasis added); see Meagher, 943 F.2d at 1282 ("This court,
and others, have uniformly interpreted the language of Section
3568 and its predecessors as precluding the calculation of the
time served on a federal charge from any date other than that
on which the defendant was delivered to federal prison
officials."); see also United States v. Segal, 549 F.2d 1293,
1301 (9th Cir.) ("[T]he district judge has no authority to
impose a federal sentence concurrent with a state sentence
because a federal term cannot begin until a prisoner has been
received by federal authorities.") (citing 18 U.S.C. § 3568),
cert. denied, 431 U.S. 919, 97 S.Ct. 2187, 53 L.Ed.2d 231
(1977).

The Sentencing Reform Act of 1984, which took effect
after the defendant in Meagher was convicted, repealed this
longstanding rule. Section 3568 was replaced with new §§ 3584
and 3585. While new § 3585 also provides that a federal
sentence commences when the defendant is received into federal
custody, see 18 U.S.C. § 3585(a) (1994), it is clear that

6
must consider the factors enumerated in 18 U.S.C. § 3553(a) (1994).

18 U.S.C. § 3584(b). These factors, which the court considers

whenever imposing a sentence, include the sentencing guidelines.

See 18 U.S.C. § 3553(a)(4)(A), (5). Pursuant to 28 U.S.C. §

994(a)(1)(D), the United States Sentencing Commission promulgated

section 5G1.3 of the sentencing guidelines to guide a district

court in determining whether a sentence should run concurrently or

consecutively to an undischarged term of imprisonment. See United

States Sentencing Commission, Guidelines Manual, § 5G1.3 (Nov. 1,

Congress intended to authorize a district court to order that
a federal sentence run concurrently to a state sentence.

The clause prohibiting "any other method of computing the
term" was omitted from new § 3585. Furthermore, new § 3584
specifically authorizes a federal sentence to run concurrently
to "an undischarged term of imprisonment." 18 U.S.C. §
3584(a). The legislative history for both sections makes
Congress' intent clear. See S.Rep. No. 98-225, at 129 (1984)
("The Committee ... does not intend that [new § 3585] be read
to bar concurrent Federal and State sentences for a defendant
who is serving a State sentence at the time he receives a
Federal sentence."), reprinted in 1984 U.S.C.C.A.N. 3182,
3312; id. at 126-27 & nn. 310, 314 (commenting that new §
3584(a) "changes the law that now applies to a person
sentenced for a Federal offense who is already serving a term
of imprisonment for a State offense" and noting that the new
section is intended to overrule Segal and similar cases),
reprinted in 1984 U.S.C.C.A.N. at 3309-10.

That district courts now have authority to impose
sentences concurrent to undischarged state sentences has been
explicitly recognized by the United States Sentencing
Commission, see Revisions to the Sentencing Guidelines for the
United States Courts, 60 Fed.Reg. 62,289, 62,291-92 (1995),
and by other circuit courts of appeals, see, e.g., United
States v. Terrovona, 785 F.2d 767, 770 (9th Cir.), cert.
denied, 476 U.S. 1186, 106 S.Ct. 2926, 91 L.Ed.2d 553 (1986),
and is expressly acknowledged by this court today.

7
1993).7

The district court's determination that Fuentes' sentence

should run consecutively to his undischarged state sentences

resulted from its application of this guideline to the facts. We

therefore review this determination de novo. See United States v.

Johnson, 87 F.3d 1257, 1258 (11th Cir.1996).

A.

Section 5G1.3 contains three different subsections. The first

addresses sentencing for an offense committed while the defendant

was serving the undischarged term of imprisonment; the second

provides the rule for sentences not covered by the first subsection

where "the undischarged term of imprisonment resulted from

offense(s) that have been fully taken into account in the

determination of the offense level for the instant offense"; and

the third provides a policy framework for "any other case."8 It is

7
When reviewing a sentence on appeal, we generally apply the
guidelines in effect on the date the appellant was sentenced.
United States v. Shields, 87 F.3d 1194, 1196 n. 2 (11th Cir.1996)
(en banc). However, subsequent amendments that clarify a
guideline, rather than make substantive changes, should be
considered on appeal regardless of the date of sentencing. United
States v. Stinson, 30 F.3d 121, 122 (11th Cir.1994).

Because Fuentes was sentenced on August 29, 1994, we
apply the guidelines from the 1993 manual. We note that the
relevant subsection, § 5G1.3(b), has not been amended since
1993. While § 5G1.3(c) has been amended, that subsection does
not apply in the instant case, as we discuss infra note 9.

The commentary to § 5G1.3 has been amended, and because
we construe these commentary changes as clarifying amendments,
we consider the most recent version. Unless otherwise noted,
all citations to the guidelines are to the 1993 version.
8
The full text of § 5G1.3 at the time of appellant's
sentencing stated:

8
undisputed that Fuentes committed the instant offense before the

undischarged state sentences were imposed, thus the first

subsection clearly does not apply. Fuentes contends that the

second subsection, section 5G1.3(b), controls the instant case,

while the Government argues that this subsection does not apply and

that the third subsection governs.9

Section 5G1.3(b) dictates that a federal sentence run

concurrently to an "undischarged term of imprisonment [that]

resulted from offense(s) that have been fully taken into account in

the determination of the offense level for the instant offense."

According to the sentencing guidelines' commentary, this guideline

(a) If the instant offense was committed while the
defendant was serving a term of imprisonment (including
work release, furlough, or escape status) or after
sentencing for, but before commencing service of, such
term of imprisonment, the sentence for the instant
offense shall be imposed to run consecutively to the
undischarged term of imprisonment.

(b) If subsection (a) does not apply, and the
undischarged term of imprisonment resulted from
offense(s) that have been fully taken into account in the
determination of the offense level for the instant
offense, the sentence for the instant offense shall be
imposed to run concurrently to the undischarged term of
imprisonment.

(c) (Policy Statement) In any other case, the sentence
for the instant offense shall be imposed to run
consecutively to the prior undischarged term of
imprisonment to the extent necessary to achieve a
reasonable incremental punishment for the instant
offense.
9
As a fall back argument, Fuentes also argues that even if §
5G1.3(c) controls, that subsection requires a concurrent sentence.
The Government argues that § 5G1.3(c) granted the district court
discretion to order the sentence to run consecutively. Because we
find that § 5G1.3(b) applies, we need not address the proper
interpretation of § 5G1.3(c).

9
applies when the undischarged term was imposed for "conduct taken

into account in determining the guideline range for the instant

offense." U.S.S.G. § 5G1.3, comment. (n.2) (Nov. 1, 1995).

To illustrate how this guideline is to be applied, the

commentary provides the example of a defendant convicted for

selling thirty grams of cocaine. Id. At the time of sentencing,

the defendant in the example has served six months of a nine-month

state sentence imposed for the sale of fifteen grams of cocaine.

Id. In calculating the defendant's guideline range, the example
posits that the fifteen grams of cocaine underlying the state

sentence are considered relevant conduct pursuant to U.S.S.G. §

1B1.3,10 and thus the defendant's offense level is calculated based

10
Section 1B1.3(a) provides that when calculating a defendant's
total offense level, the district court should consider the
following:

(1) (A) all acts and omissions committed, aided, abetted,
counseled, commanded, induced, procured, or willfully
caused by the defendant; and

(B) in the case of a jointly undertaken criminal
activity (a criminal plan, scheme, endeavor, or
enterprise undertaken by the defendant in concert with
others, whether or not charged as a conspiracy), all
reasonably foreseeable acts and omissions of others in
furtherance of the jointly undertaken criminal activity,

that occurred during the commission of the offense of
conviction, in preparation for that offense, or in the
course of attempting to avoid detection or responsibility
for that offense;

(2) solely with respect to offenses of a character for
which § 3D1.2(d) would require grouping of multiple
counts, all acts and omissions described in subdivisions
(1)(A) and (1)(B) above that were part of the same course
of conduct or common scheme or plan as the offense of
conviction;

10
on forty-five grams of cocaine. Id. The sentencing court in the

example calculates the guideline range to be from ten to sixteen

months and determines that the appropriate sentence for the federal

conviction is thirteen months. Id. The commentary states that

proper application of § 5G1.3(b) results in a seven-month sentence

(the thirteen months determined by the court minus the six months

already served on the state sentence) to run concurrently with the

remaining three months of the state sentence.11 Id.

From the guidelines, commentary, and the above example, we

conclude that whenever a defendant is subject to an undischarged

sentence imposed for criminal activity that section 1B1.3 treats as

relevant conduct, section 5G1.3(b) directs the court to impose a

sentence that runs concurrently to the undischarged sentence.

B.

Fuentes argues that the conduct underlying his undischarged

(3) all harm that resulted from the acts and omissions
specified in subsections (a)(1) and (a)(2) above, and all
harm that was the object of such acts and omissions; and

(4) any other information specified in the applicable
guideline.

U.S.S.G. § 1B1.3(a). We discuss this section in greater
detail infra part II.C.
11
The commentary also suggests,

For clarity, the court should note on the Judgment in a
Criminal Case Order that the sentence imposed is not a
departure from the guideline range because the defendant
has been credited for guideline purposes under § 5G1.3(b)
with six months served in state custody that will not be
credited to the federal sentence under 18 U.S.C. §
3585(b).

U.S.S.G. § 5G1.3, comment. (n.2) (Nov. 1, 1995).

11
state sentences (that is, the chopping of the state Porsches) is

relevant conduct under section 1B1.3. The Government counters by

correctly noting that it did not seek to include the chopping of

the state Porsches as relevant conduct when it provided the

probation office with information for the PSR. Pursuant to U.S.S.G.

§ 2F1.1(b)(1), the probation office calculated Fuentes' offense

level in part on the basis of the value of the Porsches he had

chopped. Because the Government gave the probation office no

indication that the chopping of the state Porsches should be

treated as relevant conduct, the probation office did not include

the value of the state Porsches in calculating Fuentes' offense

level. Thus, the Government contends, section 5G1.3(b) does not

apply because the conduct underlying the state offenses was not

"fully taken into account in the determination of the offense level

for the instant offense." In fact, the probation office did not

take that conduct into account at all in determining Fuentes'

offense level.

The appellant responds to this contention by arguing that his

chopping of the state Porsches was required to be treated as

relevant conduct. He claims that the Government and probation

officer intentionally omitted the state Porsches from the

calculations to avoid application of section 5G1.3(b). He

correctly notes that whether or not the state Porsches were

included had absolutely no effect on the sentencing range provided

by the guidelines.
Although including the state Porsches would have increased his

12
base offense level, the sentencing range applicable without this

increase was 100-125 months (offense level, after adjustments not

relevant here, of 24 with a criminal history category of VI).

However, the maximum sentence authorized for the instant offense

was only 60 months, see 18 U.S.C. § 371, well below the range

provided by the sentencing guidelines table. Thus, with or without

the state Porsches, the guideline sentence was 60 months. See

U.S.S.G. § 5G1.1(a) ("Where the statutorily authorized maximum

sentence is less than the minimum of the applicable guideline

range, the statutorily authorized maximum sentence shall be the

guideline sentence.").

The essence of Fuentes' argument is that the "fully taken into

account" requirement of section 5G1.3(b) is satisfied when the

undischarged term resulted from an offense that section 1B1.3

requires to be included as relevant conduct, regardless of whether

the sentencing court actually took that conduct into account. We

agree.

The purpose of both sections 5G1.3(b) and 1B1.3 is to provide

one, uniform punishment for the same criminal activity. We have

noted that the guidelines provide for punishment not just for the

"offense of conviction," but for all "offense conduct," which

"refers to the totality of the criminal transaction in which the

defendant participated and which gave rise to his indictment,

without regard to the particular crimes charged in the indictment."

United States v. Scroggins, 880 F.2d 1204, 1209 n. 12 (11th
Cir.1989), cert. denied, 494 U.S. 1083, 110 S.Ct. 1816, 108 L.Ed.2d

13
946 (1990); see also United States v. Flowers, 13 F.3d 395, 397

(11th Cir.1994) (per curiam) ("The intended purpose of section

5G1.3(b) is to effectively "credit[ ] for guidelines purposes'

defendants who have already served time—generally in another

jurisdiction—for the same conduct or course of conduct.") (quoting

U.S.S.G. § 5G1.3, comment. (n.2)).

This principle underlies the Supreme Court's recent opinion in

Witte v. United States, --- U.S. ----, 115 S.Ct. 2199, 132 L.Ed.2d

351 (1995), in which the Court held that consideration of prior

convictions as relevant conduct in calculating a guideline sentence

does not violate the Double Jeopardy Clause. The Court stated:

[Section] 5G1.3 of the Guidelines attempts to achieve some
coordination of sentences imposed in ... situations [where a
defendant is prosecuted in more than one jurisdiction for the
same criminal course of conduct] with an eye toward having
such punishments approximate the total penalty that would have
been imposed had the sentences for the different offenses been
imposed at the same time (i.e., had all of the offenses been
prosecuted in a single proceeding).

Because the concept of relevant conduct under the
Guidelines is reciprocal, § 5G1.3 operates to mitigate the
possibility that the fortuity of two separate prosecutions
will grossly increase a defendant's sentence.... Significant
safeguards therefore protect [a defendant] against having the
length of his sentence multiplied by duplicative
considerations of the same criminal conduct....

Id. at ---- - ----, 115 S.Ct. at 2208-09 (citations omitted); see

also id. at ----, 115 S.Ct. at 2213 (Stevens, J., concurring in

part, dissenting in part) ("The Guidelines will generally ensure

that the total sentence received in ... two proceedings [involving

prosecutions for the same course of conduct] is the same sentence
that would have been received had both offenses been brought in the

same proceeding.").

14
 Assuming for the moment that the district court could have

considered the chopping of the state Porsches as relevant conduct

under section 1B1.3,12 we conclude that the Government deliberately
refrained from portraying Fuentes' chopping of the state Porsches

as relevant conduct for one reason—to manipulate the application of

the guidelines so that his federal sentence would run consecutively

to the state sentences. That inclusion of the state Porsches would

have had absolutely no effect on the length of the guideline

sentence makes this conclusion all the more inescapable.

We find such manipulation by the Government contrary to both

the letter and spirit of the guidelines. First, section 1B1.3

states that a defendant's offense level "shall be determined on the

basis of" all relevant conduct. U.S.S.G. § 1B1.3(a) (emphasis

added). Thus, intentionally to refrain from considering relevant

conduct violates the command of the sentencing guidelines. In a

similar context, we suggested that a district court must consider

all relevant conduct—even if the defendant entered into a plea

bargain suggesting that such conduct would not be considered at

sentencing. See Scroggins, 880 F.2d at 1214 ("Nor did the

Government's agreement to drop count one of appellant's indictment

somehow impliedly preclude the district court from considering

evidence [that the defendant committed the offense charged in the

dropped count]—under guideline sentencing, counsel cannot bind the

sentencing discretion of the district judge....").

Second, the guidelines were written to prevent the Government

12
We turn to this inquiry in part II.C, infra.

15
from manipulating indictments and prosecutions to increase

artificially a defendant's sentence or sentences for the same

criminal conduct. The guidelines state that the Sentencing

Commission "has written its rules for the treatment of multicount

convictions with an eye toward eliminating unfair treatment that

might flow from count manipulation." U.S.S.G. Ch. 1, Pt. A, intr.

comment. § 4(a), p.s. The guideline sentencing scheme is designed

to avoid "the potential [that] prosecutors [will] influence

sentences by increasing or decreasing the number of counts in an

indictment." Id. Although these comments are directed at count

manipulation in a single prosecution, they are equally applicable

to manipulation in successive state and federal prosecutions. See

Scroggins, 880 F.2d at 1214 (indicating that guidelines do not

allow prosecutor to "cloak the facts to reach a result contrary to

the guidelines' mandate").

Moreover, interpreting section 5G1.3(b) to apply when the

undischarged sentence resulted from conduct that was required to be

taken into account in determining the defendant's sentence, even if

it was not taken into account, is in accord with the sentencing

scheme embraced by the guidelines. Guideline sentencing represents

a compromise between two competing paradigms of sentencing—"real

offense" sentencing and "charge offense" sentencing. See generally

Stephen Breyer, The Federal Sentencing Guidelines and the Key

Compromises upon Which They Rest, 17 Hofstra L.Rev. 1, 8-12 (1988)

(describing this compromise as one between "procedural" and
"substantive" justice); see also Scroggins, 880 F.2d at 1212-13

16
(summarizing the dichotomy between the two systems). Under a real

offense system, the sentencing judge considers all the defendant's

conduct surrounding the offense in fashioning a sentence. A charge

offense system, on other hand, bases the defendant's sentence only

on the charged offense itself.

The difference between the systems is best understood by

considering an example. Posit a defendant convicted of robbery.

Under a real offense system, the court will fashion a sentence

based on the totality of the defendant's conduct in committing the

offense. Thus, a higher sentence will be imposed if the defendant

committed the offense in a violent manner, if the robbery was but

one episode in a spree of robberies on the same day in the same

city, or if the defendant stole an inordinately large amount of

money. Conversely, a lower sentence would be imposed if the

defendant committed the offense without violence, if the robbery

was an isolated incident, or if only a de minimis amount was

stolen. In other words, the sentence will be tailored to the

circumstances of the crime. The facts to be considered by the

court need not be included in the charge for which the defendant

was convicted.

Under a charge offense system, however, the defendant will

only be sentenced based on the charged offense itself; the

sentence will only reflect the facts essential to the offense of

conviction. In the example, the defendant's sentence would be the

same regardless of how he carried out the robbery.
The sentencing guidelines are best described as "closer to a

17
charge system[, but] contain[ing] a significant number of real

offense elements." U.S.S.G. Ch. 1, Pt. A, intr. comment. § 4(a),

p.s.; see also Scroggins, 880 F.2d at 1212-13. As Justice Breyer

aptly noted before ascending to the High Court, guideline

sentencing is a charge system in that it "looks to the offense

charged to secure the "base offense level.' " Breyer, supra, at

11-12. However, the system draws from the real offense system

because "[i]t then modifies that level in light of several "real'

aggravating or mitigating factors (listed under each separate

crime), several "real' general adjustments ("role in the offense,'

for example) and several "real' characteristics of the offender,

related to past record." Id. at 12; see also Scroggins, 880 F.2d

at 1213.

The guidelines thus provide a method for uniformly calculating

a sentence based, to the extent practicable, on the totality of a

defendant's conduct. The Sentencing Commission decided to

incorporate elements of real offense sentencing when a defendant

faces multiple counts or multiple prosecutions "[i]n order to limit

the significance of the formal charging decision and to prevent

multiple punishment for substantially identical offense conduct."

U.S.S.G. Ch. 3, Pt. D, intr. comment. The guidelines state,

"Convictions on multiple counts do not result in a sentence

enhancement unless they represent additional conduct that is not

otherwise accounted for by the guidelines." Id.

We find that this real offense sentencing approach should
apply with equal force to multiple convictions in different

18
jurisdictions. Consequently, when a defendant subject to an

undischarged state sentence is subsequently sentenced in federal

court, the defendant's aggregate time served (that is, time served

in state prison plus time served in federal prison) should not

exceed the guideline sentence—assuming no upward departure is

appropriate—unless the state sentence "represent[s] additional

conduct that is not otherwise accounted for by the guidelines" in

determining the federal sentence.

We therefore conclude that when a defendant is serving an

undischarged sentence resulting from conduct that is required to be

considered in a subsequent sentencing proceeding as relevant

conduct pursuant to section 1B1.3, section 5G1.3(b) provides that

the subsequent sentence should run concurrently to the undischarged

sentence. This conclusion does not end our inquiry, however. We

still must determine whether section 1B1.3 requires that Fuentes'

chopping of the state Porsches be considered relevant conduct in

determining his sentence.13

C.

To determine whether section 1B1.3 requires that Fuentes'

chopping of the state Porsches be considered relevant conduct, we

follow a somewhat complex chain of cross-references in the

guidelines. We begin with section 1B1.3(a), which defines four

13
We note that Fuentes did not object to the sentencing court's
(or the PSR's) failure to include the state Porsches as relevant
conduct in calculating his offense level. We find that this
failure to object should not prejudice his argument on appeal
regarding the application of § 5G1.3. By timely objecting to the
sentencing court's (and the PSR's) § 5G1.3 determination, he
adequately preserved this issue for appeal.

19
categories of relevant conduct.14 One category, defined by section

1B1.3(a)(2), applies when sentencing a defendant for an offense

covered by section 3D1.2(d).15 Section 3D1.2(d) covers a conspiracy
"if the offense that is the object of the conspiracy ... is [also]

covered under" that subsection. U.S.S.G. § 3D1.2, comment. (n.6).

Fuentes was sentenced for conspiracy to violate 18 U.S.C. §§ 511(a)

and 2321, both of which are covered by section 3D1.2(d).16 Section

1B1.3(a)(2) therefore defines relevant conduct for determining

Fuentes' sentence.

Section 1B1.3(a)(2) includes as relevant conduct, inter alia,

all acts committed by the defendant "that were part of the same

course of conduct or common scheme or plan as the offense of

conviction." Our complicated journey through the guidelines

therefore reveals that the crucial question in this appeal is

whether Fuentes' conduct in chopping the state Porsches is "part of

the same course of conduct or common scheme or plan as" the instant

federal offense—chopping the federal Porsches. Fortunately, this

question is easily resolved.

"Same course of conduct" and "common scheme or plan" are

14
This subsection is quoted in note 10, supra.
15
Section 3D1.2(d), which aggregates closely related counts
when sentencing a defendant on multiple counts, covers a long list
of Chapter Two guidelines, each of which in turn governs the
calculation of the base offense level for specific federal
offenses. In other words, a particular offense is covered by §
3D1.2(d) if the offense level for that offense is governed by a
guideline listed in § 3D1.2(d).
16
The offense levels for these substantive offenses are
governed by U.S.S.G. § 2B6.1. See U.S.S.G.App. A. Section 2B6.1 is
one of the guidelines covered by § 3D1.2(d).

20
terms of art defined in the commentary to section 1B1.3. Two

offenses form the same course of conduct if "they are sufficiently

connected or related to each other as to warrant the conclusion

that they are part of a single episode, spree, or ongoing series of

offenses." U.S.S.G. § 1B1.3, comment. (n.9(B)) (Nov. 1, 1995)

(emphasis added). In evaluating whether two or more offenses meet

this test, the sentencing court should consider "the degree of

similarity of the offenses, the regularity (repetitions) of the

offenses, and the time interval between the offenses." Id.; see

also United States v. Maxwell, 34 F.3d 1006, 1011 (11th Cir.1994)

(concluding—before cited commentary was added to guidelines—that

court should consider "similarity, regularity, and temporal

proximity" of offenses).

We believe that examination of each of these factors firmly

establishes that the conduct underlying both the state and federal

offenses constitutes the same course of conduct. Both offenses

were very similar, if not identical. The Government conceded as

much at the sentencing hearing, noting that the state and federal

"charges may involve similar criminal activity, but it's not the

same criminal activity" (emphasis added).

The offenses also were committed with clear regularity and

within a very close time period. In a little over three years, the

appellant stole and chopped Porsches at least eighteen different

times. The last state Porsche was stolen in February 1991, and the

first federal Porsche was stolen no later than March 1991. Five of
the federal Porsches were stolen at unknown dates in 1991; it is

21
possible that they were stolen before the last state Porsche.

Thus, all three factors outlined by the guidelines suggest that the

offenses formed an ongoing series of offenses and therefore qualify

as the same course of conduct. See Scroggins, 880 F.2d at 1211

(agreeing with district court finding that series of thefts from

self-service stamp vending machines formed same course of conduct).

Moreover, the offenses also constitute a common scheme or

plan. A common scheme or plan refers to offenses "substantially

connected to each other by at least one common factor, such as

common victims, common accomplices, common purpose, or similar

modus operandi." U.S.S.G. § 1B1.3, comment. (n.9(A)) (Nov. 1,

1995). We find at least two common factors, although only one is

required.

The offenses shared the same purpose—making money by selling

stolen Porsche parts to co-conspirators and bona fide purchasers.

They also share an identical modus operandi. The PSR describes the

federal offense conduct as follows: "The defendant's basic method

of operation revolved around the theft of Porsches, bringing them

to a warehouse which he rented as his chop shop premises, and

dismantling them inside the warehouse." Fuentes' method of

operation for the state offenses, as described in the PSR, was

almost identical. The only difference was that Fuentes brought the

state Porsches to a residence and his friend's shed, instead of to

a rented warehouse; this is a trivial deviation. Chopping the

state and federal Porsches clearly constitute a common scheme.
Thus, the state offenses must be considered relevant conduct

22
under section 1B1.3(a)(2) because the state and federal offenses

formed both the same course of conduct and a common scheme or plan.

The Government's attempts to distinguish the offenses are

unconvincing. The Government points out that the offenses involved

different Porsches, different victims, and different chop shop

locations.17 While there are differences between the offenses, they

are dwarfed by the similarities.

If the maximum prison sentence authorized by 18 U.S.C. § 371

had not been an issue and the Government had sought to include the

state offenses as relevant conduct to raise Fuentes' offense

level,18 we cannot imagine that any court would find the offenses

unrelated. Surely the Government would complain bitterly if we

were to apply the strict test for relevant conduct that it argues

for here. That consideration of the state offenses leads to a

lesser sentence in this case is no reason to apply a more stringent

17
The Government also asserts that the federal offense involved
a different modus operandi than the state offenses. It claims that
the federal Porsches were all stolen from doctors' offices or
hospitals, while the state Porsches were stolen from residences.
Although this distinction would make little difference even if
accurate, we note that the PSR belies the Government's
characterization. It indicates that some of the federal Porsches
were also stolen from residences.
18
We point out that had the Government not agreed to drop the
other charges in the indictment and obtained convictions for them,
the maximum authorized prison sentence would be easily and properly
circumvented by proper application of the guidelines. Even though
the maximum prison sentences available for each of the dropped
substantive charges might have fallen below the guideline range,
the guidelines provide that where "the highest statutory maximum is
less than the total punishment [provided by the guidelines], ...
the sentence imposed on one or more of the other counts shall run
consecutively, but only to the extent necessary to produce a
combined sentence equal to the total punishment." U.S.S.G. §
5G1.2(d).

23
standard. Cf. Scroggins, 880 F.2d at 1213 (noting that "real

offense elements do not always work to the disadvantage of a

defendant; in many cases, consideration of these factors will act

to reduce an offender's sentence").

We hold that Fuentes' undischarged state sentences resulted

from conduct that the guidelines require to be "fully taken into

account in the determination of the offense level for the instant

offense," and that the district court consequently erred in

concluding that section 5G1.3(b) does not require the instant

sentence to run concurrently to the state sentences. Cf. United

States v. French, 46 F.3d 710, 717 (8th Cir.1995) (finding state

perjury conviction and federal fraud and perjury convictions to be

relevant, thus warranting concurrent sentences under § 5G1.3(b),

because offenses were "based upon actions taken ... during the same

time period, in the same general geographic area, for the same

purpose, as part of a common plan ..., and involving the same set

of ... assets").

D.

Even though the guidelines require a concurrent sentence in

this case, the sentencing court is always free to consider an

upward departure. See 18 U.S.C. § 3553(b) (1994) (authorizing

departure from guidelines if "the court finds that there exists an

aggravating or mitigating circumstance of a kind, or to a degree,

not adequately taken into consideration by ... the guidelines that

should result in a sentence different from" the sentence provided
by the guidelines). We have expressly recognized that a court may

24
impose a consecutive sentence where the guidelines call for a

concurrent sentence, as long as the court follows the proper

procedures for departing from the guidelines. United States v.

Harris, 990 F.2d 594, 597 (11th Cir.1993) (citing United States v.

Perez, 956 F.2d 1098, 1103 (11th Cir.1992)).

Although the instant case may well present compelling reasons

for an upward departure,19 the district court made no indication it
was departing from the guidelines, nor did it follow the required

procedures. See 18 U.S.C. § 3553(c)(2) (requiring court to explain

in open court reasons for departure from guidelines); United

States v. Valentine, 21 F.3d 395, 398 (11th Cir.1994) (requiring

sentencing judge to give defendant notice that it is considering

departure). Thus, Fuentes' sentence clearly resulted from an

erroneous interpretation of the guidelines.

19
The court stated at sentencing:

[T]here are powerful reasons, indeed, why the defendant's
sentence in this case should be run consecutive to the
State penalty, rather than concurrent....

....

...[I]t seems to me under the circumstances of this
case that plainly [Fuentes' sentence] ought to be made to
run consecutive. I do not see—I could be wrong as I see
it, but I do not see this as a difficult or a close
question with regard to whether the sentence on the
conspiracy ought to be made to run consecutive to a
different offense in a different forum.

....

...I am satisfied that for all of the reasons that
have been stated that his sentence should be made to run
consecutive ..., because [that] would achieve a
reasonable incremental punishment in this offense, which
I think is the touchstone of the analysis.

25
 Because the court could have imposed a consecutive sentence

had it determined that an upward departure was warranted, we may

not direct that Fuentes' sentence run concurrently to the state

sentences. Rather, we must vacate the sentence and remand for

resentencing. See United States v. Bell, 46 F.3d 442, 443 (5th

Cir.1995) (remanding on same grounds).

III.

Fuentes also challenges the district court's order that he pay

$357,281 in restitution. He claims that the district court erred

in ordering full restitution because he was indigent at the time of

sentencing and unlikely to be able to pay the full amount of

restitution in the future. Because the record suggests that the

district court found that Fuentes was not likely to be able to pay

the full restitution amount in the future, we vacate the

restitution order and direct the district court to reconsider the

issue of restitution.

A.

Sentencing Guidelines section 5E1.1 directs the sentencing

court to order restitution whenever authorized by 18 U.S.C. §§

3663-3664 (1994). These sections, part of the Victim and Witness

Protection Act of 1982 (the "VWPA"), Pub.L. No. 97-291, 96 Stat.

1248,20 allow district courts to order defendants to pay restitution

20
The provisions for restitution were amended substantially by
the Mandatory Victims Restitution Act of 1996, Pub.L. No. 104-132,
§§ 201-211, 1996 U.S.C.C.A.N. (110 Stat.) 1227. These new
provisions take effect for cases in which the defendant is
convicted on or after April 24, 1996. § 211, 1996 U.S.S.C.A.N. (110
Stat.) at 1241. Because Fuentes was convicted before this date,
the new act has no application to this case.

26
to any victim of a Title 18 offense. See 18 U.S.C. § 3663(a)(1).

To determine the amount of restitution, if any, the sentencing

court "shall consider the amount of the loss sustained by any

victim as a result of the offense, the financial resources of the

defendant, the financial needs and earning ability of the defendant

and the defendant's dependents, and such other factors as the court

deems appropriate." 18 U.S.C. § 3664(a).21

An examination of the transcript of the sentencing hearing

shows that these factors were considered. The probation officer

who had prepared the PSR calculated the total loss to the victims

of Fuentes' offense to be $380,781. Defense counsel objected to

the inclusion of two victims with losses totaling $13,500,

contending that these two victims had conspired with Fuentes.22

After sustaining these defense objections, the court determined

that "full restitution" was $357,281.23

Furthermore, defense counsel, the Government, and the

probation officer made several arguments concerning Fuentes'

21
We elaborate on these procedures in greater detail in part
III.C, infra.
22
Specifically, the two alleged victims had purchased Porsche
engines from Fuentes at below-market prices. Due to the low
prices, defense counsel suggested, and the Government conceded,
that these victims knew, or at least should have known, that they
were buying stolen parts and thus did not deserve restitution.
This consideration is a good example of a section 3664(a) "other"
factor deemed appropriate by the trial court.
23
Unfortunately, the probation officer, the Government, and the
district court appear to have committed multiple mathematical
errors in calculating restitution. Because we are vacating the
restitution order and remanding for recalculation, we need not
address these errors.

27
financial condition and earning capacity. Everyone agreed that

Fuentes was indigent and could not pay restitution at the time of

sentencing. The focus of most of the testimony at sentencing

regarding restitution was on Fuentes' ability to pay restitution in

the future, while on supervised release.24 Defense counsel

contended that Fuentes' lack of job skills rendered him unlikely to

be able to make full restitution during his period of supervised

release. Both the Government and the probation officer argued that

the very nature of his crimes showed that he possessed significant

mechanical skills that would help him earn a legitimate living and

pay restitution following his release.

Defense counsel conceded that some restitution might be

appropriate, but argued that ordering full restitution would be

improper in light of Fuentes' current financial condition and

limited skills. In response to this concern, the probation officer

recommended restitution in the full amount suggesting that the

probation office could determine how much Fuentes could pay in

monthly payments during supervised release. The Government agreed

with the probation officer's recommendation and further argued that

full restitution was appropriate so that an order would be in place

in the admittedly unlikely event that Fuentes did acquire enough

money to pay full restitution.

After considering all these arguments, the court ordered

24
The VWPA authorizes the district court to order that
restitution be payable within five years after imprisonment. 18
U.S.C. § 3663(f)(2)(B). Good faith compliance with a restitution
order is a condition of supervised release. § 3663(g).

28
restitution in the amount of $357,281. The final judgment stated,

"Payments of restitution are to be made as directed by the U.S.

Probation Office."25 In this appeal, Fuentes challenges the amount

25
Fuentes contends on appeal that the district court may not
delegate to the probation office the duty of setting a payment
schedule for restitution. His argument finds support in both the
text of the VWPA and the majority of cases from other circuits
addressing this issue. The VWPA provides, "The [sentencing] court
may require that [the] defendant make restitution under this
section within a specified time or in specified installments." 18
U.S.C. § 3663(f)(1) (emphasis added); see also U.S.S.G. § 5E1.1,
comment. (backg'd) ("The restitution order should specify the
manner in which ... payment is to be made.").

Several circuits have found that this language prevents
district courts from delegating authority to set payment
schedules. See, e.g., United States v. Graham, 72 F.3d 352,
356-57 (3d Cir.1995), cert. denied, --- U.S. ----, 116 S.Ct.
1286, 134 L.Ed.2d 230 (1996); United States v. Porter, 41
F.3d 68, 71 (2d Cir.1994); United States v. Ahmad, 2 F.3d
245, 248-49 (7th Cir.1993). But cf. United States v. Lilly,
901 F.Supp. 25, 31-32 (D.Mass.1995) (ordering full restitution
but declining to set payment schedule and instead allowing
probation office to "assess the defendant's progress toward
satisfaction of [restitution]" and to act to revoke supervised
release if satisfactory progress is not made), aff'd, 80 F.3d
24 (1st Cir.1996).

Other circuits have held that the determination of
restitution and payment schedules is a judicial function the
delegation of which would violate Article III of the United
States Constitution. See, e.g., United States v. Johnson, 48
F.3d 806, 808-09 (4th Cir.1995); United States v. Albro, 32
F.3d 173, 174 (5th Cir.1994) (applying plain error standard).
But see United States v. Barany, 884 F.2d 1255, 1260 (9th
Cir.1989) (approving delegation under Probation Act of
determination of payment schedule for restitution to probation
office where court has set "maximum amount of restitution in
light of that loss"), cert. denied, 493 U.S. 1034, 110 S.Ct.
755, 107 L.Ed.2d 771 (1990).

Notwithstanding the plain language of the statute and the
persuasive opinions from our sister circuits, our precedent
clearly authorizes delegation of payment schedules to the
probation office. See United States v. Stinson, 97 F.3d 466,
468 n. 1 (1996) (per curiam) (citing United States v.
Lombardo, 35 F.3d 526, 528 n. 2 (11th Cir.1994) (per curiam)).
As we are bound by precedent, we must reject Fuentes'

29
of restitution in light of his financial condition. Specifically,

he argues that the district court erred in ordering restitution in

an amount that the record showed he would unlikely be able to pay

either at the time of sentencing or in the future.

B.

The VWPA requires sentencing courts to "consider," inter

alia, "the financial resources of the defendant, [and] the

financial needs and earning ability of the defendant and the

defendant's dependents." 18 U.S.C. § 3664(a). Although a

sentencing court may order restitution even if the defendant is

indigent at the time of sentencing, United States v. Stevens, 909

F.2d 431, 435 (11th Cir.1990), it may not order restitution in an

amount that the defendant cannot repay. See United States v.

Remillong, 55 F.3d 572, 574 (11th Cir.1995) (per curiam); cf.

United States v. Apex Roofing of Tallahassee, Inc., 49 F.3d 1509,

1514 (11th Cir.1995) (vacating restitution order against dissolved

corporation partly because it was not able to pay restitution). A

contrary rule would effectively eliminate the mandate of section

3664(a) that the sentencing court consider the defendant's ability

to pay.26

delegation challenge.
26
Although the primary policy behind orders of restitution is
clearly the compensation of victims for their losses, limiting
restitution orders to an amount that the defendant can pay serves
other important policies. A restitution order in an amount the
defendant cannot possibly pay "threatens respect for judicial
orders generally." Remillong, 55 F.3d at 574 (quoting United
States v. Bailey, 975 F.2d 1028, 1032 (4th Cir.1992)) (internal
quotation marks omitted).

30
 In light of this requirement that restitution not exceed the

defendant's ability to pay, we must focus on the district court's

consideration of Fuentes' ability to pay. We review orders of

restitution for abuse of discretion. See Remillong, 55 F.3d at

574. A district court abuses its discretion when it orders

restitution in an amount that it finds the defendant is not likely

to be able to pay. Our review of the record strongly suggests

that, although it made no explicit findings regarding ability to

pay, the court believed that Fuentes was not likely to be able to

pay restitution in the amount ordered.27

Moreover, an order in an amount well beyond a defendant's
means strongly detracts from any hope of rehabilitation for
the defendant. See United States v. Mahoney, 859 F.2d 47, 52
(7th Cir.1988) ("[I]t is most paramount that the defendant, in
the all-important rehabilitative process, have at least a hope
of fulfilling and complying with each and every order of the
court."). Judge Winter of the Second Circuit has elaborated
on this policy:

A defendant subject to an impossible restitution order
may be tempted to pay little or nothing because partial
restitution offers no assurance of being considered by
the court as satisfaction of the order. As a result, a
defendant subject to an impossible restitution order has
less incentive to seek remunerative, rehabilitative, and
non-criminal employment and to maximize his or her income
than a defendant subject to a difficult but doable order.

Porter, 41 F.3d at 73 (Winter, J., concurring); cf. Bearden
v. Georgia, 461 U.S. 660, 670-71, 103 S.Ct. 2064, 2072, 76
L.Ed.2d 221 (1983) ("Revoking the probation of someone who
through no fault of his own is unable to make restitution ....
may have the perverse effect of inducing the probationer to
use illegal means to acquire funds to pay in order to avoid
revocation.").
27
We note that this would be a different case if the record
either showed that the court believed Fuentes was able to pay
restitution in the amount ordered or gave no indication of its
belief on this issue. In imposing an order of restitution, a court
need not make an explicit finding that the defendant will be able

31
 At the sentencing hearing, the court prefaced the discussion

about the amount of restitution by commenting, "I don't know that

it's going to make all that much difference in this case." When

defense counsel began to point out that Fuentes was indigent, the

court interrupted, "All you are saying is it's academic.... I want

to find out what the amount is. That's really the thrust of my

question." The court also stated that the Government "hardly

expect[s] that [Fuentes] is going to ultimately be able to make

restitution in the full amount, but ... it's fair and reasonable to

require that some restitution be made."

Later in the discussion, defense counsel stated that "based on

the Court's statement now—I think we all agree that he cannot make

full restitution, so we need to find a monetary amount that he can

make" (emphasis added). Apparently agreeing with defense counsel's

statement that Fuentes could not pay the full amount, but believing

that some amount of restitution "does make sense to the victims,"

the court next asked the Government how to calculate the award in

an amount Fuentes would be able to pay. The Government responded,

It's not really possible to calculate how much the defendant
is going to able to repay during his period of supervised
release or later on in his lifetime. The State of Florida
certainly provides ample legal protection against debtors from
having their entire means of living taken by creditors, so I
don't think the Court needs to worry about him being oppressed
by a large debt.

to make restitution in the amount ordered so long as the record
provides sufficient reasons for the decision to order restitution.
Remillong, 55 F.3d at 576 (citing United States v. Hairston, 888
F.2d 1349, 1352-53 (11th Cir.1989)). This form of review is not
appropriate where, as here, the record strongly suggests the
sentencing court found that the defendant was unlikely to be able
to comply with the order.

32
 It is the Government's position that he should be ordered
to pay the full amount of restitution, and that while he is on
supervised release, his supervised release officer can
designate that portion of his income that should be given over
to restitution based on how much money he is making and what
his obligations are to support himself or any legal
dependents, and that the debt should be established so that in
the future if [Fuentes] does come into sufficient money to be
collectable under the laws of the State of Florida or the
United States, then that order will be there and the victims
will have their opportunity.

The Government conceded that "[t]here may not be a strong

likelihood" that Fuentes would "come into" such a sum of money.

Apparently accepting these arguments, the court ordered full

restitution.

Taken together, all these statements by the court and counsel

convince us that there is at least a strong likelihood that the

court ordered restitution in an amount it believed Fuentes was

unlikely to be able to pay. The Government's argument that full

restitution is nonetheless appropriate may be persuasive, but it is

foreclosed by the inclusion of the defendant's ability to pay among

the factors the sentencing court must consider. The mere

possibility that a defendant will unexpectedly acquire a large sum

of money is not sufficient to support an order in an amount he is

unlikely to be able to pay. See Remillong, 55 F.3d at 575 n. 8. As

the Third Circuit has noted,

[I]f it is realistic that [the] defendant may inherit a
substantial sum from a well-off relative or has a story to
write that will be a bestseller, then the district court would
be entitled to consider these possible additional sources of
income in fashioning a restitution order. On the other hand,
we will not put the court in the lottery business.
United States v. Logar, 975 F.2d 958, 964 (3d Cir.1992); see also

Mahoney, 859 F.2d at 51 n. 6 ("The prospect of the defendant's

33
winning a lottery—present in any case—is too remote a possibility

to justify [an unreasonably high] restitution order....").

Moreover, the VWPA requires the sentencing judge to consider

ability to pay at the time of sentencing. See United States v.

Sasnett, 925 F.2d 392, 398-99 (11th Cir.1991) (per curiam) (holding

that restitution must be determined at sentencing and cannot be

postponed, even in light of uncertainty of predicting defendant's

future ability to pay). Under the Government's line of reasoning,

a sentencing court should order full restitution in every instance,

regardless of the financial resources of the defendant.28 On this

point, we find instructive the observation of the Seventh Circuit:

[H]ad Congress intended that the defendant's ability to pay be
considered only after ... nonpayment, it could very easily
have mandated that the court direct the payment of full
restitution in every case subject to a later revision of the
said order should the defendant fail to comply with his
payment schedule based upon his financial condition.

Mahoney, 859 F.2d at 52.

The VWPA states, "Any dispute as to the proper amount ... of

restitution shall be resolved by the court by the preponderance of

the evidence." 18 U.S.C. § 3664(d). The defendant bears the

28
Congress apparently adopted this policy in the Mandatory
Victim Restitution Act of 1996. Under the new act, the sentencing
court may not consider "the economic circumstances of the
defendant" when determining the amount of restitution. § 206(a),
1996 U.S.C.C.A.N. (110 Stat.) 1232, 1234 (to be codified at 18
U.S.C. § 3664(f)(1)(A)).

The court will take these factors into account when it
determines "the manner in which, and the schedule according to
which," the defendant will satisfy the restitution order. Id.
(to be codified at 18 U.S.C. § 3664(f)(2)). If the defendant
cannot pay any amount of restitution, the court may direct him
to pay "nominal periodic payments." Id. (to be codified at 18
U.S.C. § 3664(f)(3)(B)).

34
burden of persuasion on the issue of his ability to pay. Id. The

defendant carries this burden when the court finds that the

defendant more likely than not will be unable to pay full

restitution. To order full restitution in the face of this finding

constitutes an abuse of discretion. Because our review of the

record strongly suggests that the court made just such a finding,

we must vacate the restitution order and remand for recalculation
29
in an amount Fuentes is likely to be able to pay. See United

States v. Grimes, 967 F.2d 1468, 1473 (10th Cir.) (vacating

restitution order where sentencing court had stated, "[i]t's, of

course, doubtful that she could pay much or at least any

substantial amount of restitution"), cert. denied sub nom. McGlynn

v. United States, 506 U.S. 927, 113 S.Ct. 355, 121 L.Ed.2d 269

(1992).

C.

To assist the sentencing court in its task, we briefly discuss

the proper procedures for determining restitution when a defendant

29
Because the court did not expressly find that full
restitution was beyond Fuentes' means, we acknowledge that it is
possible that the court believed Fuentes would be able to pay the
full amount. We must vacate the order, however, because the record
is not sufficient to clear up this ambiguity. Cf. Hairston, 888
F.2d at 1352-53 (holding that district court should make express
findings of fact where the record "does not provide an adequate
basis for appellate review").

Nothing in this opinion should be interpreted to imply
that we believe the original $357,281 order is or is not, as
a matter of fact, beyond Fuentes' means. If the court finds
on remand that Fuentes will be able to make full restitution,
that determination would be a factual finding entitled to
clear error review only.

35
alleges that she is unable to pay.30 The procedural scheme for

issuing an order of restitution is set forth in 18 U.S.C. § 3664.

As discussed supra, the sentencing court must "consider" several

factors—most importantly, the amount of loss by any victim of the

offense and the defendant's financial condition and ability to pay.

18 U.S.C. § 3664(a).

While the VWPA authorizes the court to order the probation

office to gather pertinent information either in the PSR or a

separate report made available to both sides, 18 U.S.C. § 3664(b),

(c), the statute explicitly allocates between the parties burdens

of persuasion with respect to the relevant restitution issues. The

Government must prove the amount of loss by a preponderance of the

evidence, and the defendant must establish her financial resources

and needs by a preponderance of the evidence. 18 U.S.C. § 3664(d).

The burden of proving other relevant issues falls "upon the party

designated by the court as justice requires." Id.

In most cases, the amount of loss will be relatively clear,

30
This discussion only applies to sentencing proceedings in
cases in which the defendant was convicted prior to April 24, 1996.
As discussed in note 20, supra, all other cases are governed by the
procedures outlined in the Mandatory Victims Restitution Act of
1996. We provide this discussion to assist the sentencing court on
remand of the instant case and to provide guidance for the
substantial number of sentencing hearings not covered by the new
act.

Two of the major changes are that restitution is
mandatory for, inter alia, Title 18 crimes against property,
§ 204(a), 1996 U.S.C.C.A.N. (110) Stat. at 1227-29 (to be
codified at 18 U.S.C. § 3663A(a)(1), (c)(1)(A)(ii)), and that
the sentencing judge does not consider the defendant's
financial resources at all when determining the amount of
restitution, instead accounting for ability to pay when
setting the payment schedule, see supra note 28.

36
and the Government will have little trouble carrying its burden.

Determining how much restitution the defendant is able to pay is a

much more speculative venture; the court must look into the future

and predict the defendant's ability to pay. When the defendant is

subject to a long prison term, this determination becomes

progressively more speculative.

In light of the allocation of burdens of persuasion, there is

a presumption that the defendant can pay full restitution. The

defendant must present some evidence that she cannot pay full

restitution before ability to pay becomes an issue. Because the

defendant bears the burden of persuasion, she also bears the risk

of nonpersuasion. Thus, while a bald assertion that she is

indigent may put her ability to pay at issue, a defendant may not

be able to carry her burden without persuasive evidence supporting

her claim.

Once the defendant presents evidence suggesting that she

cannot pay full restitution, the sentencing court assumes its

traditional fact finding role. The court must evaluate not just

the probative value of the evidence before it, but also the

credibility of any witnesses, particularly the defendant. If the

court is not persuaded by the defendant's evidence, or if it finds

that the evidence is in equipoise, it is free to order full

restitution. Thus, a defendant who is not completely candid with

the court and merely asserts that she is indigent faces a

formidable risk that full restitution will be ordered.
Where the underlying criminal conduct resulted in substantial

37
financial gain for the defendant, a strong inference may arise that

the defendant has access to the fruits of her crime, or at least

proceeds therefrom. She must present convincing evidence to rebut

this natural inference. See United States v. Copple, 74 F.3d 479,

486 (3d Cir.1996) (Alito, J., concurring) ("All the [illegally

obtained] assets for which the defendant cannot account may be

included in the amount of restitution ordered. To the extent that

records are unavailable, the risk of inaccuracy should be borne by

the defendant rather than the victims.").

Although it need not introduce any evidence of ability to

pay—again, the defendant bears the burden of persuasion on this

issue—the Government often will seek to rebut the defendant's

evidence of indigency. It may seek to prove that the defendant has

secreted assets or concealed a source of income (for example, a

family member who provides the defendant with financial

assistance). It may also point to evidence adduced at trial to

prove that the defendant is underrepresenting her financial

abilities.

If the defendant shows to the satisfaction of the sentencing

court that it is more likely than not that she cannot pay full

restitution at the time of sentencing, the sentencing court must

fashion a restitution order that accounts for her ability to pay.31

31
The defendant retains her burden on ability to pay even if
she has successfully proven that she cannot be expected to pay full
restitution. She bears the burden of proving how much restitution
she cannot pay or, depending on one's perspective, how much
restitution she can pay. This concept is implicit in the
defendant's burden on ability to pay.

38
While it may solve this problem by simply ordering restitution in
32
a lesser amount or declining to order restitution at all, the

better course often will be to set up a payment schedule over time.

The VWPA authorizes the court to make restitution payable by a

specified date or to set a schedule of installments. 18 U.S.C. §

3663(f)(2).

There are statutory limits to the deadline by which full

payment must be made. If the court sentences the defendant to

probation, it must require that the full amount of restitution

ordered be paid by the end of the period of probation. 18 U.S.C.

§ 3663(f)(2)(A). When no probation is ordered, the court must

require restitution within five years of the end of the term of

imprisonment imposed, or if no imprisonment is imposed, within five

years of the date of sentencing. 18 U.S.C. § 3663(f)(2)(B), (C).

The sentencing court must fashion a restitution order so that the

defendant reasonably will be able to comply with the order within

the statutorily mandated time period.33 See Remillong, 55 F.3d at

32
While the court may decline to order any restitution in light
of the defendant's financial condition, Stevens, 909 F.2d at 435,
restitution even in a small amount is favored, see 18 U.S.C. §
3553(c) (1994) (requiring court to explain why partial or no
restitution is ordered); U.S.S.G. § 5E1.1 (requiring restitution
where authorized); Ahmad, 2 F.3d at 247 ("When there is doubt
about ability to pay, the court should order full restitution.").

The court may also decline to order any restitution if it
"determines that the complication and prolongation of the
sentencing process resulting from the fashioning of an order
of restitution ... outweighs the need to provide restitution
to any victims." 18 U.S.C. § 3663(d). Again, however, some
restitution is favored.
33
We note that although the sentencing court must determine the
amount of restitution in light of the defendant's ability to pay

39
575 & n. 8.

Calculating the exact amount that the defendant will be able

to pay within the statutory period may be the most difficult and

speculative task facing the sentencing court. The longer the term

of imprisonment, the more speculative any prediction of future

earnings becomes. However, the VWPA requires that this

determination be made at the time of sentencing. See Sasnett, 925

F.2d at 398-99. The task is not impossible, nor is it a duty for

which district courts are unprepared. They must make similar
determinations when calculating future earnings in tort and

employment discrimination cases.

Counterbalancing the speculative nature of this determination

are mechanisms that soften the effects of an order that turns out

within the time period provided by § 3663(f), the defendant is not
automatically "off the hook" at the end of that period. While the
court might no longer be able to enforce its order through its
contempt power or through revocation of supervised release, the
VWPA provides two other methods of enforcement.

First, the United States can enforce a restitution order
"in the manner provided for the collection and payment of
fines in subchapter B of chapter 229 of" Title 18 of the
United States Code. Subchapter B of chapter 229 provides inter
alia that a fine is "a lien in favor of the United States upon
all property belonging to the person fined." 18 U.S.C. §
3613(a) (1994). This lien becomes unenforceable twenty years
after entry of judgment or upon the defendant's death. See 18
U.S.C. § 3613(b).

Second, both the United States and any victim named in
the restitution order may enforce the order "in the same
manner as a judgment in a civil action." 18 U.S.C. §
3663(h)(1)(B), (h)(2). Presumably, the restitution order may
be recorded as a money judgment and thus become a lien on the
defendant's property. If so, this form of enforcement would
be governed by the statute of limitations applicable to
judgment liens.

40
to be beyond the defendant's means. The sentencing court remains

free to modify its order in the future if the defendant's financial

condition changes.34 See Stevens, 909 F.2d at 435. Moreover, the

VWPA expressly provides that district courts must "consider the

defendant's employment status, earning ability, financial

resources, the willfulness of the defendant's failure to pay, and

any other special circumstances that may have a bearing on the

defendant's ability to pay." 18 U.S.C. § 3663(g); see also

Bearden, 461 U.S. at 672, 103 S.Ct. at 2073 (holding that

sentencing court cannot revoke defendant's probation for failure to

pay fine or restitution absent finding that defendant was

responsible for failure to pay or that no alternative punishment

would adequately punish and deter defendant).

This court takes the speculative nature of a sentencing

court's prediction of an indigent defendant's future earnings into

account by reviewing such determinations with a deferential

standard. See United States v. Porter, 90 F.3d 64, 68 (2d

Cir.1996) ("Because of the nuanced nature of the decision to impose

restitution it makes little sense for an appellate court,

significantly more removed from the case than the district court,

to scrutinize the decision closely."). We review any factual

finding that the defendant will be able to comply with the

34
Although this modification usually will entail a reduction
of the restitution to be paid where a defendant's financial
condition worsens, some courts have suggested that the amount may
be increased where the defendant's financial condition improves.
See United States v. Mitchell, 893 F.2d 935, 936 (8th Cir.1990);
Mahoney, 859 F.2d at 51 n. 6. But see Porter, 41 F.3d at 71
(calling this practice into doubt).

41
restitution order for clear error, Sasnett, 925 F.2d at 397, and

restitution orders themselves for abuse of discretion, Remillong,

55 F.3d at 574.

When the sentencing court makes the restitution determination

by following the procedures discussed here, its determination

rarely will be disturbed on appeal. A quick review of the record

of the sentencing hearing will reveal whether the court followed

these procedures. If the defendant raises an ability-to-pay

objection at sentencing, the record must show that the sentencing

court considered all relevant evidence of the defendant's financial

resources as well as the financial needs of the defendant and her

dependents. United States v. Page, 69 F.3d 482, 493 (11th

Cir.1995). If the court finds that the defendant likely will be

able to pay restitution in the amount ordered, its finding will be

reviewed only for clear error. Even if it does not make an

explicit finding, its order will be affirmed so long as the record

supports a finding that the defendant likely will be able to pay

restitution in the amount ordered. Hairston, 888 F.2d at 1353.

Finally, where the record suggests that the court found as a matter

of fact that the defendant would not be able to make restitution in

the amount ordered, as the record in the instant case suggests, the

order will be vacated as an abuse of discretion.

IV.

For the foregoing reasons, we hold that the district court

erred in ruling that the sentencing guidelines require that
Fuentes' sentence run consecutively to his undischarged state

42
sentences and also erred in ordering restitution in an amount it

found he unlikely was able to pay. We therefore VACATE the

appellant's sentence and REMAND the case for resentencing in

accordance with this opinion.

SO ORDERED.

43