Wednesday, November 13th, 2013

District Court Abused Discretion in Awarding Restitution for Unsubstantiated Losses

United States v. Simmons, No. 12-2187-cr (2d Cir. Nov. 13, 2013) (Katzmann, Leval, and Pooler) (summary order), available here

Convicted of conspiracy to commit bank and wire fraud, the defendant was sentenced to 41 months of imprisonment, $1.3 million in forfeiture, and $1.3 million in restitution to Siren Management Company and Community Preservation Corporation (“CPC”). On appeal, the defendant challenged only the restitution order.
By summary order, the Circuit held that Siren was properly found to be a “victim” for restitution purposes because it was directly harmed by the defendant’s criminal conduct in the course of the fraudulent scheme. The Circuit held that CPC was also a victim for restitution purposes, not a co-conspirator, as the defendant claimed.  
The Circuit agreed with the defendant, however, that the district court abused its discretion by including in Siren’s loss amount more than $250,000 based solely on an unsworn letter from Siren claiming a lump-sum amount lost in unpaid “common charges and assessments.” The government had provided almost no information about the loss amount, no documentation regarding Siren’s asserted loss, and no explanation as to why providing more information was impracticable. Accordingly, the Circuit remanded for the district court to reduce the restitution award or, alternatively, to obtain adequate proof of the claimed loss amount. 
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