Sunday, December 13, 2020

Case o' The Week: Stretch on Loss Gets Sentence Tossed - Gainza and Guideline Loss Calculations for Identity and ATM Schemes

 "The lesson in this case is that trying is not the same as succeeding."

United States v. Gainza, 2020 WL 7222136, *1 (9th Cir. Dec. 8, 2020), decision available here.

Players: Decision by Judge McKeown, joined by Judge Nguyen and visiting DJ Vitaliano. Nice win for ED AFPD David Porter.  

Facts: Gainza and his co-D set up “skimmers” in ATMs, along with hidden cameras to capture pin numbers. Id. at *1. Though over eight hundred people used these compromised ATMs, only 37 reported fraudulent access. Id. at *2.

  Gainza and his co-D were arrested, charged with conspiracy to possess at least fifteen counterfeit access devices, bank fraud, access device fraud, possession of device-making equipment, and aggravated identity theft. Id. They plead guilty to all charges.

  Over defense objection, at sentencing the district court calculated guideline loss by multiplying the number of people that visited the ATMs by $500 (resulting in loss amounts of several hundred thousand dollars). Id. The pair were hit with a twelve offense level by virtue of these loss amounts, and sentenced to four and five years. Id.

 Issue(s): “The issue on appeal . . . is how much loss the scheme caused.” Id. at *1. “[T]he Guidelines recommend that a minimum of $500 in loss be applied for each account number that Gainza and Gabriele-Plage obtained. The pivotal question, then, is how many account numbers [they] obtained.” Id. at *3.

Held: “In calculating the loss amount, the district court concluded that Gainza and Gabriele-Plage obtained account information for each person who visited the ATMs while the cameras and skimmers were installed. But while there is evidence that Gainza and Gabriele-Plage hoped to obtain account information for each ATM customer, there is insufficient evidence that they succeeded in doing so. The district court's conclusion to the contrary was clear error, so we promptly vacated the sentences and remanded the cases for resentencing.” Id. at *1.

  “The government offered insufficient evidence that the defendants obtained or used 852 account numbers. And while the government showed how many people used the ATMs while the skimmers were installed, it did not provide any evidence of the skimmer success rate, either for these transactions or even for hypothetical transactions. Without this evidence, the record cannot support a finding that Gainza and Gabriele-Plage obtained information ‘that can be used to initiate a transfer of funds’ from each ATM customer. 18 U.S.C. § 1029(e)(1). And while it is true that the sentencing judge ‘need only make a reasonable estimate of the loss,’ U.S.S.G. § 2B1.1 cmt. n.3(C), that estimate must be based on facts, not conjecture.” Id. at *3.

 Of Note: The Ninth had decided the sentences were erroneous several months before the opinion was ready. To its great credit, way back in October the panel issued an order “vacating the sentences and remanding for expeditious sentencing.” Id. at *1 & n.1. The happy result? Both defendants were sentenced to time served, long before this opinion was even issued. Id. This is an admirable approach (particularly in the era of COVID): would be nice to see these expedited orders more often, in defense sentencing wins.

 How to Use: Note an important caveat: Judge McKeown doesn’t say the government couldn’t prove possession of cards or account numbers – just that it failed to do so here. She works through cases where the government met that burden, where defendants had spreadsheets with credit card numbers, possessed stolen cards, or used account numbers. Id. at *3. Very fact-based stuff, making Gainza an important Guidelines read.                                            

For Further Reading: Who will get the COVID vaccines, and when? In a courageous letter, Oregon Chief D.J. Hernandez argued that criminal defendants should get a shot (pun intended). See article here

  California is deciding vaccine schedules now. Incarcerated folks should be in Phase 1b, before the judiciary. See OpEd here.  


WC Fields quote from

Image of COVID vaccine from 

Steven Kalar, Federal Public Defender N.D. Cal. Website at





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Tuesday, December 22, 2020 6:40:00 PM  

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