Free Objection to Presentence Investigation Report - District Court of Arizona - Arizona

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PAUL K. CHARLTON United States Attorney District of Arizona Richard I. Mesh Assistant U.S. Attorney Two Renaissance Square 40 N. Central Avenue, Suite 1200 Phoenix, Arizona 85004-4408 Arizona State Bar No. 02716 Telephone (602) 514-7500 [email protected]

UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA United States of America, Plaintiff, v. Gregory Allen Evans, Defendant. The United States of America by and through its undersigned attorneys, hereby files GOVERNMENT'S OBJECTIONS TO PRESENTENCE REPORT CR-04-0276-05-PHX-SMM

14 pursuant to Title 18 U.S.C., Section 3552(d) and Local Rule 32.1.1, the following corrections 15 and objections to the presentence report (PSR) in this matter. 16 1. Correction of paragraph 3. 17 a) Paragraph 3 incorrectly recites that per the plea agreement, the defendant's "offense 18 level will be calculated based upon the loan applications personally prepared by the defendant." 19 The quoted language omitted that the level of the offense "shall be based upon the loss incurred 20 from the fraudulent student loan applications personally prepared by the defendant..." 21 (Underlining supplied.) (See plea agreement paragraph 3d.) The face amount of all the 22 fraudulent student loans prepared by the defendant was known to be $919,988.57, but the face 23 amount of the defaulted loans was $282,125.73 and as such, the latter amount was stipulated 24 to as the maximum amount of loss. 25 It was known by the government that the face value of the 143 fraudulent loans prepared 26 by the defendant amounted to $919,988.57. At the time of the defendant's guilty plea, in excess 27 of four years had elapsed and 70 percent of the loans were still performing in accordance with 28

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their contract. Therefore, the government elected to use the "actual loss to the victim" as the standard for calculation of the offense level pursuant to U.S.S.G. Section 2F1.1(b), Application Note 8(b), "in fraudulent loan application cases and contract procurement cases, the loss is the actual loss to the victim (or if the loss has not yet come about, the expected loss)." b) Paragraph 3 also omitted that the defendant as well as the government, will waive its right to appeal the sentence imposed by the court. 2. Objection to PSR, paragraph 24. Paragraph 24 computes the loss arising from the conspiracy as in excess of $2.5 million, hence, 13 additional levels are added to the sentencing calculation. This method of calculation is incorrect. The government stipulated that the loss level "shall be based upon the loss incurred from fraudulent student loan applications personally prepared by the defendant....rather than vicarious liability arising from all losses attributable to the conspiracy." The actual loss was then known to be $282,125.73. If that figure was applied to the sentencing calculation, it would bring about an increase of 8 levels rather than 13, hence, a reduction in the total offense level to 13 rather than 18. See paragraph 31, PSR. 3. Correction to PSR, paragraph 75. a) Paragraph 75 mistakenly recites "the defendant's offense level will be determined using only the fraudulent loans he processed." (Underlining supplied) This is incorrect. As has been previously noted, the plea agreement, per stipulation, requires, "the loss incurred from the fraudulent student loan applications" will be used to determine the offense level. There is a difference between the amount of "processed" loans and the "losses" from the processed loans. b) The government's stipulation to the maximum loss level of $282,125.73 under the

23 guidelines arose from several factors. First, the limitation, as stipulated to by the government, 24 was pursuant to the guidance provided in U.S.S.G. Section 1B1.3(a)(1)(B). This section deals 25 with relevant conduct factors that determine the guideline range as to "jointly undertaken criminal 26 activity." Application Note 2(ii) states that "the scope of the criminal activity jointly undertaken 27 by the defendant (the `jointly undertaken criminal activity') is not necessarily the same as the 28 2

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1 scope of the entire conspiracy, and hence relevant conduct is not necessarily the same for every 2 participant. In order to determine the defendant's accountability for the conduct of others under 3 subsection (a)(1)(B), the court must first determine the scope of the criminal activity the particular 4 defendant agreed to jointly undertake . . . " (Italics supplied.) 5 Secondly, in arriving at the above stipulation, the government took into account that the

6 defendant was terminated from employment in December 1999 and thus his involvement with 7 the conspiracy ended at that point. The conspiracy continued on for at least 6 more months. 8 Therefore, the losses occasioned by the later criminal acts of other co-conspirators should not be 9 chargeable against this defendant or serve as part of the calculation of the scope of his jointly 10 undertaken criminal activity. 11 Thirdly, the victim bank continued to receive the benefits of the 70 percent of the loans that

12 were being paid according to the terms of contracts. There was no loss to the victim bank as to 13 these loans. 14 Fourthly, the unique circumstances of this conspiracy were that each co-conspirator only

15 profited from the applications he or she personally processed. There was a combination of effort 16 in the criminal acts by each loan processor with Robert C. Hazlett, who approved their loan 17 applications and received the lions' share of the illegally generated profits. There was no 18 evidence to suggest that loan processors shared in the profits from others illegally generated fees. 19 20 4. Conclusion On the basis of all of the forgoing, the government respectfully requests this court to adjust

21 the level of offense for sentencing purposes from a level 18 as indicated in the presentence report 22 to a level 13 as indicated in this pleading. The government further respectfully requests the court 23 to direct a correction as to the other matters incorrectly published in the presentence report. 24 25 26 27 28 3

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Respectfully submitted this 2nd day of November 2005.

PAUL K. CHARLTON United States Attorney District of Arizona S/Richard I. Mesh Richard I. Mesh Assistant U.S. Attorney

CERTIFICATE OF SERVICE I hereby certify that on the 2 nd day of November, 2005, I electronically transmitted the attached document to the Clerk's Office using the CM /ECF system for filing and transmittal of a Notice of Electronic Filing to the following CM/ECF registrants: Dana Carpenter, Esq. 3106 N. 16th Street Phoenix, AZ 85016 Attorney for Defendant Evans George F. Klink, Esq. 45 W est Jefferson Suite 220 Phoenix, AZ 85003 Attorney for Defendant Prather Greg Clark, Esq. 45 W est Jefferson 11th Floor Phoenix, AZ 85003 Attorney for Defendant Honderd Booker T. Evans, Esq. 2375 E. Camelback Rd., Ste. 700 Phoenix, AZ 85016 Attorney for Defendant Hazlett S/Richard I. Mesh I hereby certify that on 2 nd day of November, 2005, I served the attached document by fax on the

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following, who are not registered participants of the CM/ECF system: Shawn T. Shear Senior U.S. Probation Officer 401 W . W ashington St., Ste. 160 Phoenix, AZ 85003 S/Richard I. Mesh

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