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In United States v. Dullum, No. 07-4502, March 13, 2009, the Court of Appeals affirmed the District Court’s ruling on five sentencing adjustments including; intended loss, vulnerable victim, abuse of trust, obstruction of justice, and acceptance of responsibility in this mail and bank fraud case. The most interesting fact about this case is that the defendant was a Secret Service Special Agent In Newark and an active member of his New Jersey church when the offenses were committed.
Dullum befriended two fellow church members who were recovering alcoholics/drug addicts, and were "a little slow", and volunteered to serve as their financial advisor. The Government maintained that it was in that capacity that Dullum forged one of the victim’s signatures on her will, did not inform the deceased’s family that he was acting as the executor of her estate, made misrepresentations about the value of the estate, transferred money form the estate’s bank account into his person account, and produced a fabricated $20,000 promissory note made out to him by the deceased.
The bank fraud aspect of the case involved a rental property at the Jersey shore owned by Dullum. He deposited two rent checks from the same renter into the estate account and then transferred the money to his personal account. (After depositing the first rent check in the estate bank account, Dullum falsely claimed he did not receive the check. He asked the renter to send a new check made payable to one of the two church members, who he falsely claimed was his wife.) Dullum made restitution for the two checks, after he was interviewed by the Secret Service and the bank froze his accounts.
Dullum argued that the District Court should have applied a four rather than a six level enhancement for loss because his bank fraud scheme (the rent checks) caused no loss. The Court held that Dullum intended to cause a loss for the full amount of the rent check. The Court rejected Dullum’s argument, that he is entitled to credit for repayment of the loss amount, because his repayment was after and not before the crime was uncovered. U.S.S.G. § 2B1.1 App. N.3(E)(I). The Court also rejected Dullum’s argument that the loss associated with the rent check should be reduced to zero because he had other funds in his bank accounts to offset the check.
Dullum argued that the two fellow church members were not vulnerable and were not direct victims. The Court, citing United States v. Monostra, 125 F.3d 183, 189 (3d Cir. 1997), held this enhancement is not limited to situations in which the vulnerable person is the direct victim of the offense of conviction, but that courts may look to all the conduct underlying an offense. The Court noted that the deceased victim was vulnerable, even if the direct victim was her estate. Further, there need only be one vulnerable victim in order for the two level enhancement to apply.
Dullum argued that his relationship with his two fellow church members was not the type of situation contemplated by the abuse of trust adjustment. The Court opined that through Dullum’s involvement with his church, he acted as a teacher, advisor and counselor to the two victims, and that he spent substantial time with them over three years as a trusted church figure of authority, counseling them with respect to their substance and alcohol abuse, and acting as their financial advisor. The Court found that Dullum’s position was a private position of trust and that the District Court did not err in applying the two level enhancement.
Dullum also objected to the two level enhancement for obstruction of justice. The Court held this adjustment was justified because during the investigation Dullum was interviewed three times, and provided five sworn statements, four of which contained lies. He also provided a forged promissory note during his third interview, and failed a polygraph examination. Only after repeated interviews, did he more truthfully discuss his actions in his fifth and final sworn statement.
Finally Dullum argued he should have received a three level, rather than one level, reduction for acceptance of responsibility. The Court determined Dullum was not entitled to the benefit of this adjustment because he refused to take full responsibility for his behavior, and, conduct resulting in an obstruction enhancement ordinarily indicates the defendant has not accepted responsibility for his criminal conduct. (U.S.S.C. § 3C1.1 App. N. 4). As a result, the Court determined the District Court was well within its discretion to grant a one level rather than three level reduction for acceptance of responsibility.
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The Third Circuit, in U.S. v. Price, No. 06-4503 (3/3/09), has upheld the denial of a motion to suppress evidence found in a defendant's home, which was searched after state agents gained consent -- under disputed circumstances -- from the defendant's wife. The case ultimately boiled down to whether the consent was voluntarily given, and the court held that it was. The court avoided some difficult issues of revocation and authority by relying on the independent-source exception to the exclusionary rule.
The defendant was arrested at work on a state warrant stemming from the sale of methamphetamine to an undercover agent. After the defendant expressed concern that his young children would be left at home alone, the agents placed him in custody, went to the house, got the mother's telephone number from the children, and summoned her to the scene. Although the agents had information that the defendant operated a meth lab in his basement (and in fact discovered meth paraphernalia on the defendant at the time of his arrest), they declined to seek the defendant's consent to search his home and instead sought it from the wife at the house. The agents told the wife that they wanted to search the house (1) to make sure it was safe for her and the children, and (2) to look for a stolen ATV. They did not tell her that they were looking for a meth lab, that incriminating evidence could be used against her and her husband, or that she had the right to refuse consent.
The wife consented to a search of the house, and let an agent into a locked bedroom where he found meth paraphernalia. She then told the agent to stop searching the house, and he obliged but asked if he could look in the basement -- where the agents thought the meth lab was all along. She said she would allow it, except for the fact that the basement door was locked, she did not have a key, and did not want the door kicked in. An agent then picked the lock, and evidence of meth manufacturing was found.
The wife was then asked to sign a written consent-to-search form, which she refused to do. The agents advised her that the house was unsafe and applied for a warrant, reciting what they saw in the basement as well as other information they obtained during the search of the house and prior to the defendant's arrest. The warrant issued, and the evidence in the basement was seized.
The Third Circuit held that the wife's original consent was voluntary because (1) police do not have to tell a subject that she has the right to refuse consent; (2) the atmosphere was not coercive; and (3) the agent's half-truth about the reasons for the search did not vitiate voluntariness.
The Court dodged what it viewed as the more difficult questions of revocation and authority to search the basement through reliance on the independent-source doctrine. In these circumstance, independent source requires findings that the police would have applied for a warrant absent the constitutional violation and that the warrant would have issued. The Court ruled that, based on everything they knew before entering the basement, the agents would have applied for the warrant even if they had not entered the basement first. The Court also ruled that the warrant application, purged of the evidence from the basement, still established probable cause.
Finally, the Court upheld the terms of an appeal waiver in the defendant's plea agreement and declined to entertain his argument that the government wrongfully withheld a motion for a third-point reduction under U.S.S.G. 3E1.1(b).
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July 24th, 2009UncategorizedIn United States v. Dullum, No. 07-4502, March 13, 2009, the Court of Appeals affirmed the District Court’s ruling on five sentencing adjustments including; intended loss, vulnerable victim, abuse of trust, obstruction of justice, and acceptance of responsibility in this mail and bank fraud case. The most interesting fact about this case is that the defendant was a Secret Service Special Agent In Newark and an active member of his New Jersey church when the offenses were committed.