Unpublished Disposition, 917 F.2d 1307 (9th Cir. 1990)

MEMORANDUM^* 

Daniel Bruce Watson appeals his conviction for bank fraud against the Bank of America claiming that the court erred in refusing to admit evidence supporting his defense theory. In addition, he appeals his sentence claiming that the court erred in its application of the sentencing guidelines. We find that the district court did not err in convicting appellant. However, because the district court imposed its fine without considering the defendant's ability to pay, we remand that portion of its holding.

A. Admission of evidence and conviction.

The question of whether the district court recognized the appropriate standard of intent and therefore allowed appellant to present his defense is a question of law which we review de novo. United States v. McConney, 728 F.2d 1195, 1199 (9th Cir.) (en banc), cert. denied, 469 U.S. 824 (1984). We review evidentiary rulings concerning the admissibility of evidence for abuse of discretion. United States v. Komisaruk, 885 F.2d 490, 492 (9th Cir. 1989).

Watson claims that he was unable to present his defense theory that he believed, in part because of his diminished mental capacity, that he was owed $100,000 by Rusty Harrison because of a trust agreement and that he confused Rusty with R.M. Harrison. As a result, he claims that he thought he was entitled to the money in the Bank account and that he therefore did not have the requisite mental intent to be validly convicted of fraud.

The district court held that even if Watson believed that Rusty Harrison owed him money, and that it was Rusty Harrison's money in the Bank of America account, this is no defense to the charge that he falsely impersonated someone else in order to obtain the money. Therefore, the court ruled that the evidence supporting the theory that Watson believed that the money was owed to him by Rusty Harrison was irrelevant and inadmissible.

The requisite standard of intent for fraud is intent to defraud, not merely intent to make a false statement. United States v. Green, 745 F.2d 1205, 1207 (9th Cir.), cert. denied, 474 U.S. 925 (1985). The trial court instructed the jury that this was the level of intent it was required to find before convicting Watson.

Watson's statements to the bank, his impersonation of R.M. Harrison and the elaborate manner in which he sheltered the money after receiving it are strong evidence of an intent to defraud. The fact that Watson felt that he was entitled to the money from Rusty Harrison does not alter the fact that he acquired the money from the bank through a fraudulent scheme.

The party that was defrauded was the Bank of America, not the owner of the individual bank account. The fact that Watson may have been mistaken about the owner of the account is not a defense to the charge that he committed fraud against the bank. United States v. Bonalla, 858 F.2d 1427, 1434 n. 9 (9th Cir. 1988).

The district court properly instructed the jury that it was required to find intent to defraud in order to convict Watson. There was strong support for finding this intent in the evidence presented at trial. The theory offered by the defense was not relevant to the charges leading to Watson's conviction. Therefore, we find that the district court did not err in excluding evidence in support of that theory and we affirm appellant's conviction.

B. Minimal planning and acceptance of responsibility.

Watson claims that the district court erred in enhancing his sentence under Sec. 2F1.1(b) (2) of the United States Sentencing Commission, Guidelines Manual for "more than minimal planning." In addition, appellant argues that he was entitled to have his sentence reduced pursuant to Sec. 3E1.1(a) of the Guidelines for acceptance of responsibility.

These are factual questions which we review under the clearly erroneous standard. United States v. Gonzalez, 897 F.2d 1018, 1019 (9th Cir. 1990).

Appellant argues that because he was convicted for committing one criminal act, that it was error for the district court to enhance his sentence for more than minimal planning. However, there is nothing in the Guidelines' definition of "more than minimal planning" requiring more than a single criminal act. Other sections of the sentencing guidelines cover situations in which the defendant has committed more than a single act of criminal conduct. The "more than minimal planning" section applies to situations in which the defendant takes action in preparation for the offense.

Watson carried out an elaborate plan over an extended period of time. He placed at least one phone call and carried on a correspondence with the Bank of America in order to carry out the fraud. It was not clear error for the district court to conclude from these facts that Watson's actions involved more than minimal planning. We therefore affirm the district court's enhancement of Watson's sentence.

Watson argues that since the court allowed various statements of his into evidence under the theory that they were admissions, the statements should also be seen as acceptance of responsibility and that Watson should have had his sentence reduced as a result.

"Admission" and "acceptance of responsibility" are not synonymous. The former is an evidentiary term that covers a range of statements which can be admitted into evidence against a defendant. The latter concept applies "if the defendant 'clearly demonstrates a recognition and affirmative acceptance of personal responsibility' for his wrongdoing." Gonzalez, 897 F.2d at 1020 (quoting Guidelines Manual Sec. 3E1.1(a)). The mere fact that Watson made certain statements that were admitted into evidence does not necessarily translate into a conclusion that he clearly demonstrated an affirmative acceptance of personal responsibility. Given Watson's statements concerning his role in the crime for which he was convicted, we cannot say that the district court clearly erred in not reducing his sentence for acceptance of responsibility.

C. Imposition of the fine.

The question of whether the district court misapplied the sentencing guidelines is a question of law which we review de novo. United States v. Lockard, 910 F.2d 542, 543 (9th Cir. 1990).

Appellant claims that the district court erred in imposing a fine of $250,000. He argues that in doing so, the court departed from the guidelines' mandated sentencing range without giving him notice and without making appropriate findings on the record.

The sentencing guidelines state:

[T]he maximum fine is the greater of:

(A) the amount shown in column B of the table below;

(B) twice the estimated loss caused by the offense; or

(C) three times the estimated gain to the defendant.

Guidelines Manual, at Sec. 5E4.22(c) (2). In this case, the table indicates a maximum amount of $30,000 for Watson's offense level. Twice the estimated loss caused by the offense is $200,000. Three times the estimated gain to the defendant is $300,000. Since the amount of $300,000 is the greatest of the three figures, that is the guidelines' maximum for Watson's offense. The actual fine of $250,000 is below that maximum.

In his brief to this court appellant argued that since the presentence report had recommended a fine of $30,000, the sentencing judge departed from the guidelines. However, the fine imposed was within the applicable range. Therefore, it was not a departure from the guidelines.

Appellant claimed for the first time at oral argument that since the Bank of America had recovered some of the money through an institution-to-institution recovery process, that this represented a form of restitution. Therefore, appellant argues, the "estimated gain to defendant" was actually less than $100,000 and the maximum fine was less than $300,000.

We do not accept this argument. It is clear that for a cognizable period of time, Watson possessed the full $100,000 obtained from the Bank of America. There is no requirement in the guidelines that a defendant must permanently retain all of the funds obtained through fraud in order to have it count as a gain.

However, although appellant's sentence is within the applicable range of sentences mandated by the sentencing guidelines, we believe it was improperly imposed. Section 5E1.2(d) of the Guidelines requires that:

the court shall consider:

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(2) the ability of the defendant to pay the fine (including the ability to pay over a period of time) in light of his earning capacity and financial resources [and]

(3) the burden that the fine places on the defendant and his dependents relative to alternative punishments....

Guidelines Manual, at Sec. 5E1.2(d). See also United States v. Seminole, 882 F.2d 441, 443 (9th Cir. 1989) (vacating the imposition of the fine on the ground that " [t]he record does not establish whether [defendant] has the earning capacity to pay a fine after he is released from prison.").

Here, the district court made only a cursory comment regarding Watson's ability to pay, falling short of the explicit consideration that is required by the Guidelines. Moreover, the scant remarks made by the court do not even suggest such an ability. Apparently, the court was swayed by the fact that Watson never filed an income tax return and by allegations that he owns pieces of property under other names. As to the former, it is just as likely an indication of an ability as it is of an inability to pay the $250,000 fine. As to the latter, the court should at least have inquired into the validity of the allegation which, incidentally, Watson denies.

In short, we are unable to affirm the district court's imposition of the fine. We affirm the district court's conviction of appellant but remand its imposition of the sentence for an explicit consideration of section 5E1.2(d) (1)-(7) of the Sentencing Guidelines.

AFFIRMED in part, REVERSED in part, and REMANDED.