In the
United States Court of Appeals
For the Seventh Circuit
Nos. 10-2879, 11-1617 & 11-1625
U NITED S TATES OF A MERICA,
Plaintiff-Appellee,
v.
L ESLIE L OVE AND B OBBIE B ROWN, JR.,
Defendants-Appellants.
Appeals from the United States District Court
for the Northern District of Illinois, Eastern Division.
Nos. 08 CR 453 and 08 CR 452—Wayne R. Andersen and
Virginia M. Kendall, Judges.
A RGUED JANUARY 18, 2012—D ECIDED M AY 24, 2012
Before B AUER, M ANION, and W OOD , Circuit Judges.
M ANION, Circuit Judge. This case involves the
criminal appeals of two defendants: Bobbie Brown, Jr.,
the mastermind of a large mortgage fraud scheme, and
one of his accomplices, Leslie Love. Brown’s scheme
occurred in two different real estate markets, Las Vegas
and Chicago, and involved recruiting many lawyers,
accountants, loan officers, bank employees, realtors,
2 Nos. 10-2879, 11-1617 & 11-162
home builders, and home buyers to further a plan
where residential properties were purchased at inflated
sales prices by insincere buyers with fraudulent loan
applications. The money accumulated by Brown
through his scheme generally consisted of the dif-
ference between the inflated sales price and the actual
value of the property. Later, when the properties
were resold at lower prices or went into default,
the financial institutions that made the mortgage loans
suffered combined losses of at least $32 million.
Brown, Love, and 31 other accomplices were appre-
hended and charged with a host of fraud counts. Brown
and Love both pleaded guilty to fraud; Brown was sen-
tenced to 260 months’ imprisonment, and Love to
66 months’ imprisonment. Their cases have now been
consolidated on appeal, and Brown and Love challenge
different aspects of their respective sentences. Love
contests the number of victims used to calculate his
sentencing guidelines; his position has merit, and so
we vacate his sentence and remand for resentencing.
Brown contests the loss calculation used for his guide-
lines range and argues that his sentence is unreasonable;
his argument is unpersuasive, and we thus affirm
his sentence.
I. Background
Between August 2004 and May 2008, Brown ran an
elaborate scheme to defraud mortgage lenders by
duping those lenders into issuing approximately
150 fraudulent mortgage loans. Brown used several
Nos. 10-2879, 11-1617 & 11-1625 3
businesses that he owned in order to conduct his
scheme, and he operated in two real estate markets,
Chicago and Las Vegas. Brown was the mastermind
behind the plan, and he recruited or directed dozens of
individuals to further the scheme: lawyers, accountants,
loan officers, bank employees, realtors, home builders,
and nominee buyers. Of his accomplices, 32 people
were apprehended and criminally charged.
To operate his scheme, Brown first recruited indi-
viduals to be the nominee buyers of new or newly reno-
vated residential properties. Brown told the nominees
that they would not have to put any money down for
the purchase, that they would not have to make any
mortgage payments, and that their names would be
removed from the mortgage and title within 12
months—the properties would either be sold within
that period, or Brown himself would personally
purchase the properties from the nominees. Brown
paid each nominee approximately $15,000 to $50,000
for every property the nominee purchased.
Brown also colluded with the home builders and
the sellers of these residential properties, prompting
them to sell their properties to Brown’s nominees at
inflated prices. In particular, Brown convinced the
builders and sellers to appraise their properties at a
value at least 10% higher than the actual value of the
property.
Brown then recruited loan officers to prepare and
submit fraudulent loan packages to the lending financial
institutions. The loan applications contained false state-
4 Nos. 10-2879, 11-1617 & 11-162
ments and omissions; they inflated the nominees’ income
and assets; they understated the nominees’ liabilities;
and they failed to disclose the nominees’ intentions
about not residing at the property, their relationships
with Brown, and the fact that the nominees had
purchased other residences and had obtained other
mortgages. The loan officers who prepared the fraudulent
loan applications received kickbacks from Brown for
their services, and as with the nominees, the relation-
ships between these loan officers and Brown were
not disclosed to the lenders.
In addition to all of this, Brown recruited bank em-
ployees to create false verifications of deposit in order
to support the false claims made in the nominees’ loan
applications regarding their financial statuses. He
recruited employees from his companies to create
false verifications of employment and false verifications
of rent and leases for the nominees. He recruited accoun-
tants to create false letters alleging that the accountants
had prepared tax returns for the nominees. Finally, he
recruited attorneys privy to the scheme to represent
the nominees at real estate closings and to ensure that
the closings went smoothly.
Through the Chicago scheme, Brown obtained approxi-
mately 150 fraudulent mortgage loans, totaling more
than $95 million in loan proceeds from the victim lend-
ers. The Las Vegas scheme resulted in approximately 33
fraudulent loans totaling about $16 million.
In June 2008, in two separate indictments—one for
the Las Vegas scheme and one for the Chicago
Nos. 10-2879, 11-1617 & 11-1625 5
scheme—Brown was charged with multiple counts of
wire fraud, bank fraud, mail fraud, and identity theft. In
January 2010, he entered a plea of guilty in the Las
Vegas case without a written plea agreement with the
government; in April 2010, he entered a guilty plea in
the Chicago case through a plea agreement. The two
cases were consolidated for sentencing purposes. In
March 2011, the district court conducted a sentencing
hearing: Brown was sentenced to 216 months’ impris-
onment for the Las Vegas scheme and 240 months’ im-
prisonment for the Chicago scheme, to run concurrently.
The district court also imposed a restitution amount
of more than $32.2 million. Brown’s appeal is now before
us; he does not contest his conviction, but he does chal-
lenge his sentence.
The other appeal before us is that of one of Brown’s
co-defendants, Leslie Love. Love was involved in
Brown’s Chicago scheme from spring 2005 to fall 2006,
and participated in several fraudulent loan transac-
tions. Love was charged with multiple counts of fraud.
Following a plea agreement, he pleaded guilty to one
count of mail fraud. Love was sentenced to 66 months’
imprisonment and ordered to pay more than $7.1 million
in restitution. Love now appeals his sentence.
II. Love’s Appeal
We begin with Love’s case. In order to calculate his
sentencing guidelines, Love was found to be associated
with the fraudulent transactions for 18 different real
estate properties, and thus he was held responsible for
6 Nos. 10-2879, 11-1617 & 11-162
a total loss of more than $7.1 million. The sentencing
judge also found that the loss affected more than ten
victims—namely, the financial institutions swindled by
the fraudulent loan transactions. As a consequence, the
court imposed the two-level sentencing enhancement
under U.S.S.G. § 2B1.1(b)(2)(A)(i), for offenses with
more than ten victims. Love’s final total offense level
was 33, which corresponded to an applicable sen-
tencing guidelines range of 135 to 168 months. After
discussing the 18 U.S.C. § 3553(a) sentencing factors,
the district court ruled that there were mitigating factors
in Love’s case and that the suggested guidelines range
was not fair. Consequently, the court imposed a sen-
tence of 66 months.
Love appeals his sentence on the ground that the
district court erroneously applied the two-level enhance-
ment for an offense with more than ten victims—Love
argues that there were only seven victims associated
with his offense. Love contends that this error was not
harmless, even though he received a below-guidelines
sentence, because there is no indication that the
district court would have imposed the sentence had it
calculated the guidelines correctly without the two-level
enhancement. Therefore, Love argues, the error should
be corrected and his case should be remanded for
resentencing. Love also notes that the judgment makes
his restitution of approximately $7.1 million payable to
“Peoples Choice Home Loan,” but that this is incor-
rect—instead, the judgment should be corrected, with
the appropriate portion of the restitution designated
to each of the seven victim lenders.
Nos. 10-2879, 11-1617 & 11-1625 7
“We review the procedures followed by the district
court in sentencing de novo.” United States v. Glosser, 623
F.3d 413, 418 (7th Cir. 2010). In this case, the govern-
ment agrees with Love’s argument on appeal and
concedes that there was an error in calculating the
number of victims—there were only seven victims as-
sociated with Love’s offense, not more than ten. Thus,
Love’s final total offense level should have been 31, not
33, for a sentencing guidelines range of 108 to 135
months, instead of 135 to 168 months. Even though
Love received a sentence that was significantly below
the guidelines range, the range on which his sentence
was based was erroneously calculated. Such an error
is not harmless because it is impossible to know whether
the district court would have imposed the same
sentence had it not committed this procedural error. See
Glosser, 623 F.3d at 419-20. We therefore vacate Love’s
sentence and remand for resentencing using the correct
guidelines range. Additionally, the judgment should
be corrected with the appropriate amount of restitution
properly designated to the seven victim lending institu-
tions.
III. Brown’s Appeal
We now turn to Brown’s appeal. Brown objects to two
aspects of his sentencing: (1) he challenges the district
court’s loss calculation and his resulting sentencing
guidelines range; and (2) he argues that his 240-month
sentence was substantively unreasonable. We consider
each issue in turn.
8 Nos. 10-2879, 11-1617 & 11-162
A. Loss Calculation
Brown first contests the district court’s calculation
of the loss attributable to his offense and the cor-
responding 22-level increase in his guidelines range.
At the sentencing hearing, the government called FBI
Special Agent Donald Kaiser as a witness. Kaiser had
prepared two charts summarizing the fraudulent
loan transactions that could be attributed to Brown’s
scheme: one chart identified 102 fraudulent transac-
tions associated with the Chicago scheme, while the
other identified 32 transactions in the Las Vegas
scheme. To prepare the charts, Kaiser used information
from loan files, title company records, real estate files,
law enforcement databases, and other public sources.
Kaiser made a loss estimate for each transaction by
taking the original loan amount for each transaction
and subtracting the resale amount for each property
(when, for example, the property was sold after it went
into foreclosure or when the original buyer conducted
a short sale). In other words, Kaiser estimated the loss
to the lender to be equal to the original loan given by
the lender minus the amount recovered by the lender
after the property’s sale. During the sentencing
hearing, Kaiser described the procedure he used for
calculating the estimated loss using two particular trans-
actions as examples.
After Kaiser’s testimony, the district court admitted
the two loss-summary charts as evidence, considering
the fact that the voluminous documents summarized in
the charts could not be conveniently examined by the
Nos. 10-2879, 11-1617 & 11-1625 9
court. The court also noted that several months earlier,
the government counsel had met with the defense
counsel to review the procedure underlying the
summary charts. The district court then accepted the
two charts as describing reasonable estimates of the
losses incurred by the lending institutions as a result of
Brown’s criminal conduct. From the charts, the court
concluded that a conservative estimate for the lenders’
losses was approximately $32 million. Under the U.S.
Sentencing Guidelines, a loss in excess of $20 million
and less than $50 million corresponds to a 22-level
increase in the offense level. See U.S.S.G. § 2B1.1(b)(L).
The district court applied this 22-level enhancement,
resulting in a total offense level of 36 and a corresponding
sentencing guidelines range of 235 to 293 months.
On appeal, Brown argues that the district court erred
when it admitted into evidence the two loss-summary
charts and used the charts to calculate the estimated
loss attributable to Brown’s criminal conduct. We
review a district court’s calculation of loss for clear error.
United States v. Green, 648 F.3d 569, 583 (7th Cir. 2011).
“Because loss calculations are reviewed for clear error,
we will only reverse if we are left with a definite and
firm conviction that a mistake has been made.” United
States v. Radziszewski, 474 F.3d 480, 486 (7th Cir. 2007)
(internal quotation and citation omitted). When cal-
culating the loss for purposes of sentencing, the district
court is only required to make “a reasonable estimate of
the loss.” Green, 648 F.3d at 583. That means that to suc-
cessfully challenge the loss calculation, Brown “must
show that the court’s loss calculations ‘were not only
10 Nos. 10-2879, 11-1617 & 11-162
inaccurate but outside the realm of permissible computa-
tions.’ ” Id. (quoting Radziszewski, 474 F.3d at 486).
Brown’s challenge to the loss calculation lacks merit.
Brown presents no evidence that the information
contained and summarized in the charts is unreliable or
erroneous. Brown’s counsel had sufficient time and
opportunity to fully review all of the information used to
prepare the summary charts and has not identified any
inaccuracies or errors. Furthermore, during sentencing,
evidentiary standards are relaxed; a sentencing court
can consider relevant information without regard to its
admissibility under the rules of evidence as long as
the information “has sufficient indicia of reliability to
support its probable accuracy.” United States v. Oros,
578 F.3d 703, 711 (7th Cir. 2009) (quoting U.S.S.G. § 6A1.3);
United States v. Rollins, 544 F.3d 820, 838 (7th Cir.
2008). With Kaiser’s testimony, this indicia of reliability
is satisfied.
Brown characterizes the methodology used to
calculate the loss as simplistic and erroneous. But the
loss calculation method used by the district court—
subtracting the sales price for each property from the
loan amount—is a reasonable method for calculating
loss that this Court has accepted on previous occasions.
See Green, 648 F.3d at 584; United States v. Serfling, 504
F.3d 672, 679-680 (7th Cir. 2007); Radziszewski, 474 F.3d at
486-87. Brown presents no sufficient reason for us to
conclude that this loss calculation is unreasonable, inac-
curate, or “outside the realm of permissible computa-
tions.” Green, 648 F.3d at 583.
Nos. 10-2879, 11-1617 & 11-1625 11
Moreover, in its Presentence Investigation Report
(PSR), the Probation Office similarly concluded that
the total amount of loss was greater than $20 million
but less than $50 million and recommended the
22-level increase as required by the Sentencing Guide-
lines. “The defendant bears the burden of proving that
the PSR is inaccurate or unreliable.” Rollins, 544 F.3d at
838. And if the defendant “offers no evidence to
question the PSR’s accuracy, the court may rely on the
PSR.” Id. In this case, Brown did not submit his version
of the offense to the Probation Office and did not
submit evidence that questioned the PSR’s accuracy.
In short, Brown has the burden of producing evidence
tending to show that the loss estimates are inaccurate
or unreliable, but he has not done so here. See Green,
648 F.3d at 583. His mere assertions of inaccuracy are
insufficient, and we are not left with “a definite and
firm conviction that a mistake has been made.”
Radziszewski, 474 F.3d at 486. Because the district
court’s ruling on the amount of loss was based on
reliable evidence and an acceptable calculation method,
the district court made a reasonable estimate of loss.
There is no clear error.
B. Reasonableness of the Sentence
Brown also challenges his sentence on the basis
that the district court was biased against him. “We
review the reasonableness of a sentence under an
abuse-of-discretion standard.” United States v. Poetz,
582 F.3d 835, 837 (7th Cir. 2009).
12 Nos. 10-2879, 11-1617 & 11-162
Here, Brown’s guidelines range was 235 to 295
months’ imprisonment, with an additional consecutive
24 months on Count 26 for identity theft, which is man-
dated by statute. The district court ended up imposing
a sentence of 216 months, below the low end of Brown’s
guidelines range, plus the mandated consecutive 24
months on Count 26, giving a total of 240 months’ im-
prisonment. A sentence below the low end of the guide-
lines is presumed reasonable. Id. Yet despite this
sentence, Brown argues that his sentence was substan-
tively unreasonable. Brown’s argument is based on the
proposition that the district court allegedly had an emo-
tional attitude and demonstrated personal bias against
Brown by unreasonably blaming him for hurting
and bringing down his co-defendants in the scheme.
Brown concludes that this biased attitude unfairly
affected his sentence. In support, Brown points to
certain excerpts from the sentencing hearing where the
district court called Brown a “Rasputin” or a “pied piper”
who manipulated and corrupted good people, causing
them to go to prison. Brown argues that his co-defendants
were not innocent victims whom he corrupted, and that
it was improper for the court to blame him and hold
him responsible for their fates.
Brown’s argument fails because the district court did
not demonstrate unfair bias. The court adequately ex-
plained the 18 U.S.C. § 3553(a) factors and its reasoning
for Brown’s sentence, and then actually imposed a
sentence that was under this recommend guidelines
range by approximately 10%. When explaining its reasons
for Brown’s sentence, the district court discussed the
serious nature of Brown’s criminal conduct and the fact
Nos. 10-2879, 11-1617 & 11-1625 13
that his scheme had a devastating impact on several
communities because of its effect on the local property
owners. The district court also noted the overwhelming
scope of Brown’s scheme, resulting in millions of dollars
in losses affecting more than 20 individual com-
munities, and his role in recruiting or directing 32
other co-defendants. The court also discussed Brown’s
character as an admitted gang member who was
motivated by greed and who, even at sentencing, failed
to fully appreciate the gravity of his actions and his
primacy in the scheme. It was not improper for the court
to take note of the significant influence and role Brown
had exercised in relation to his co-defendants. Because
the court sufficiently discussed the § 3553(a) factors
and explained its reasoning for Brown’s sentence, we
find no abuse of discretion.
IV. Conclusion
As described above, the district court erred in
calculating Love’s sentencing guidelines range, and this
error is not harmless. Love’s sentence is thus vacated
and his case is remanded for resentencing with the cor-
rected guidelines range. Additionally, his judgment
should be corrected with the restitution correctly applied
to each of the seven victims. As for Brown, the district
court did not err in its loss calculation, nor did it abuse
its discretion in imposing its sentence. Accordingly,
the judgment of the district court in Brown’s case
is affirmed.
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