Thursday, September 17, 2020

US v. Herrera, No. 19-50181 (9-9-20)(Hunsaker w/Wardlaw & Cook). This opinion considers an issue of first impression: Is the State counted as a victim for the number of victims fraud enhancement? The answer is “yes,” so long as the loss was counted in the relevant conduct.

The defendant ran an unemployment scheme where he defrauded the State and Federal Government of millions. He opened companies, recruited participants, and then had them file for unemployment benefits which he took. He was informed on and the scheme, with a co-defendant, was exposed.

The 9th held that the State was a victim for the number of victims enhancement based on the text of the guidelines. The guidelines used the word “includes” in listing who could be considered victims. State entities or agencies were not listed. But the use of “includes” was not exhaustive. Guideline amendments and restitution statutes also lend support. Lastly, other circuits have concluded that a State can be a victim for the number of victims adjustment. The limiting feature is that the loss must be included in the relevant conduct.

The 9th held the Court misspoke when it said a 16-level adjustment for loss when all the calculations showed an 18 level and it was clear that was what was being discussed. The review was under plain error.

The 9th found the defendant supervised and directed another person. Thus, there was no error in applying a leader enhancement. 

The decision is here:


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