NONPRECEDENTIAL DISPOSITION
To be cited only in accordance with Fed. R. App. P. 32.1
United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
Argued September 15, 2016
Decided November 23, 2016
Before
JOEL M. FLAUM, Circuit Judge
DANIEL A. MANION, Circuit Judge
DAVID F. HAMILTON, Circuit Judge
No. 16‐1113
UNITED STATES OF AMERICA, Appeal from the United States District
Plaintiff‐Appellee, Court for the Northern District of
Illinois, Eastern Division.
v.
No. 13‐CR‐843‐2
COLBI ANDRY,
Defendant‐Appellant. Harry D. Leinenweber,
Judge.
O R D E R
Colbi Andry was charged in a superseding indictment with six counts of wire
fraud, in violation of 18 U.S.C. § 1343, based on his participation in a scheme to defraud
homeowners seeking mortgage loan modifications. Following trial, a jury convicted
Andry on all counts. The district court determined that Andry’s guideline offense level
was 26 based on its finding that the loss totaled $122,000 and its imposition of a three‐
level enhancement for Andry’s role in the offense. Given Andry’s criminal history
category, this resulted in an advisory guideline sentencing range of 63 to 78 months’
No. 16‐1113 Page 2
imprisonment. The district court sentenced Andry to 48 months’ imprisonment. Andry
appeals, arguing the evidence presented at trial constituted an impermissible variance
from the indictment and that the district court erred in determining the amount of loss
involved and in enhancing his offense level by three for his role in the offense. We
affirm.
I.
In 2007 and 2008, Everett Pope, Andrew Ramsey, and Colbi Andry worked
together at two different mortgage companies in the Chicago area, Liberty Solutions
and J.P. Green. In late 2008 or early 2009, the three decided to start their own company,
EAC Financial (EAC). Andry was to work in marketing and sales, while Pope was to
oversee the loan processing and financial end. (Ramsey left EAC early on and he is not
involved in this case.) EAC leased an office located at 9942 S. Western Avenue in
Chicago, and purchased computers, telephones and office equipment.
EAC operated solely as a loan modification company, charging fees in exchange
for assisting customers with loan modifications. While EAC offered some legitimate
services, Pope (who pleaded guilty and testified at Andry’s trial) explained that if the
customers did not qualify for legitimate modification agreements, EAC would string
along the homeowners while accepting up‐front fees for a modification agreement that
would never materialize. EAC employees would also falsely tell customers that EAC
had over a 90% success rate in obtaining loan modifications. They also recommended
that customers stop paying their mortgages. Pope testified that in order to further
convince clients to pay up‐front fees and sign on with them, EAC falsely told customers
that an attorney was involved in negotiating the loan modification agreement. Under
Illinois law it was illegal to charge customers up‐front fees for loan modification
services, but licensed attorneys were excluded from this prohibition. Illinois Mortgage
Rescue Fraud Act, 765 ILCS 940 et. seq.
In late 2009, when the lease expired for the building out of which EAC operated,
and to escape from the rising number of customer complaints, Pope relocated to
Matteson, Illinois. Andry continued to operate out of Chicago. However, according to
Pope, Andry continued to handle the sales end while Pope handled the loan processing
end. Andry’s brother Christopher also joined him in this enterprise: Christopher’s role
was to deliver the loan modification application paperwork to the victims.
No. 16‐1113 Page 3
The City of Chicago soon detected EAC’s fraud. In response to customer
complaints, the City filed an administrative complaint against EAC, Pope, and Andry in
2010. In January 2011, to settle the complaint, Andry and Pope agreed to the entry of an
order by the City of Chicago Department of Administrative Hearings which enjoined
them from offering loan modification services in Chicago and required them to pay
$50,000 in fines and $13,125 in restitution. But rather than comply, they began using
aliases. Pope used the name “Jonathan Pincuss,” and Andry used the names “Richard
Lockwell” and “Rich Ingram.” Andry, as Lockwell or Ingram, operated under the
names “Integrity Mortgage and Insurance,” “Family First Home Solutions,” and
“Certified Forensic Auditors.” Pope, as Pincuss, held himself out as an attorney and
operated under the name “Diamond Financial LLC,” or “D Financial.”
The federal government eventually indicted Andry, his brother Christopher, and
Pope. Andry and Christopher were charged in a superseding indictment with six
counts of wire fraud related to specific loan modification agreements. Pope pleaded
guilty and testified at the Andry brothers’ trial, as highlighted above. At trial, Andry
presented a very different story: Andry claimed that he believed the loan modification
business was legitimate and that an attorney truly was working on behalf of EAC.
While the government maintained that Andry was involved in the entire scheme
to defraud since its inception in 2008, it also argued, based on our decision in United
States v. White, 737 F.3d 1121, 1138 (7th Cir. 2013), that Andry could be convicted if it
proved he was part of a smaller scheme to defraud. The district court instructed the jury
that:
If you find that there was more than one scheme [to defraud] and
the defendants whom you are considering—and the defendant
whom you are considering was a member of one or more of the
schemes, then you may find that defendant guilty only if the
scheme of which he was a member of [sic] was part of the charged
scheme. The government is not required to prove the exact scheme
charged in the indictment so long as it proves that the defendant
was a member of a smaller scheme contained within the charged
scheme.
The jury convicted Andry and his brother. (Because this appeal does not involve
the charges against Christopher, we limit our discussion of his involvement to the
extent necessary to resolve Andry’s appeal.) At Andry’s sentencing, the court first
No. 16‐1113 Page 4
determined that he was responsible for the total loss suffered by victims during the
entirety of the scheme from 2008 to 2013, which totaled $122,000. The district court also
enhanced Andry’s sentencing level by three for his role in the offense. With Andry’s
Category I Criminal History, his advisory guideline sentencing range was 63 to 78
months’ imprisonment. The district court sentenced Andry to 48 months in prison.
Andry appeals, arguing the evidence presented at trial constituted an impermissible
variance from the indictment and that the district court erred in calculating the loss
involved and in enhancing his sentence for his role in the offense.
II.
A. Variance
On appeal, Andry first argues that there was a material variance between the
charges in the superseding indictment and the proof at trial. Specifically, he claims that
the indictment charged one scheme running from 2008 to 2012, but that the evidence at
trial established multiple smaller schemes and that he was only involved in the scheme
running from February 2010 to 2012. Andry acknowledged during oral argument that
his variance argument is foreclosed by this court’s decision in White, wherein we held
“it is permissible for the government to proceed on a subset of the allegations in the
indictment, proving a conspiracy smaller than the one alleged, so long as that subset is
also illegal.” 737 F.3d at 1138. Accordingly, we reject Andry’s variance argument and
affirm his conviction.
B. Loss Calculation
Alternatively, Andry contends that while White may have justified his conviction
based on his participation in a smaller scheme, it was error to hold him responsible at
sentencing for the $122,000 loss stemming from the entire scheme to defraud because he
was only involved in the scheme at the tail end. Specifically, Andry argues that the loss
“directly attributed to the fraud scheme to which defendant participated in beginning in
or about February 2010,” totaled only approximately $36,000. The district court rejected
Andry’s argument, finding “that this was an illegal action from the very beginning and
that the defendant was aware of it and participated in it and agreed to assist it, . . . ”
At sentencing, the government must establish the loss by a preponderance of the
evidence. United States v. Orillo, 733 F.3d 241, 244 (7th Cir. 2013). “That standard
requires only that the fact‐finder believe that the existence of a fact is more probable
No. 16‐1113 Page 5
than its non‐existence, and for the purposes of determining the loss amount, a
reasonable estimate is sufficient.” Id. Further, “[w]e review the district court’s finding of
loss amount for clear error, and will reverse only if, based on the entire record, we are
left with the definite and firm conviction that a mistake has been committed.” Id.
(internal quotation omitted).
The district court did not commit clear error in holding Andry responsible for the
entire loss suffered by victims of the scheme from 2008 until 2013. The district court
heard the entirety of the evidence presented at trial, including Pope’s testimony that
when he and Andry started EAC in 2008, they agreed that if a customer did not qualify
for a refinancing, they would continue to string him along. Pope also testified that they
told customers that EAC had an attorney reviewing the paperwork, but that was not
true. Additionally, Pope told the jury that when he moved offices, he continued to work
with Andry, with Andry providing the customers and Pope providing the closing
services. While Andry challenged much of this testimony, the evidence was more than
sufficient to satisfy the preponderance of the evidence standard governing sentencing.
Accordingly, the district court did not commit clear error in holding Andry responsible
for the $122,000 loss.
C. Role in the Offense
Lastly, Andry challenges the district court’s assessment of a three‐level
enhancement at sentencing under U.S.S.G. § 3B1.1(b). That section provides that a three‐
level enhancement is appropriate where the defendant “was a manager or supervisor
(but not an organizer or leader) and the criminal activity involved five or more
participants or was otherwise extensive.” This court reviews a role‐in‐the‐offense
enhancement for clear error.
The district court did not commit clear error in enhancing Andry’s offense level
by three. Andry admitted supervising his brother Christopher, providing him with the
names and locations of the victims, and directing him to have the victims sign the
paperwork. The evidence also established that there were more than five participants in
the entire scheme. While Andry attempts to argue that he was only involved in a
smaller scheme with Pope, which did not include the requisite five or more participants,
as explained above, the district court could reasonably find that Andry and Pope were
part of the scheme to defraud from its inception until 2012. The evidence easily showed
that more than five members were involved in that scheme. Accordingly, the three‐level
enhancement under § 3 B1.1(b) was proper.
No. 16‐1113 Page 6
III.
The government charged Andry with mail fraud and established at trial that he
participated in a scheme to defraud homeowners seeking mortgage loan modifications.
Under this court’s holding in White, the jury could convict Andry even if he had
participated in a scheme smaller than that alleged in the indictment. However, the
government presented sufficient evidence to support, at sentencing, the district court’s
finding that Andry had participated in the entirety of the fraudulent scheme and was
thus responsible for the entire $122,000 loss. Similarly, the district court’s finding that
the scheme involved five or more individuals and that Andry supervised at least one
individual was not clearly erroneous. For these and the foregoing reasons, we AFFIRM.