F I L E D United States Court of Appeals Tenth Circuit UNITED STATES COURT OF APPEALS JAN 31 2000 TENTH CIRCUIT __________________________ PATRICK FISHER Clerk
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 99-5162 (N.D. Okla.) BARRY W. CONE, (D.Ct. No. 98-CR-178-H)
Defendant-Appellant. ____________________________
ORDER AND JUDGMENT *
Before BRORBY, EBEL, and LUCERO, Circuit Judges.
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is
therefore ordered submitted without oral argument.
Appellant Barry W. Cone appeals his sentence after pleading guilty to one
* This order and judgment is not binding precedent except under the doctrines of law of the case, res judicata and collateral estoppel. The court generally disfavors the citation of orders and judgments; nevertheless, an order and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3. count of bank fraud under 18 U.S.C. § 1344. On appeal, Mr. Cone argues the
district court improperly increased his sentence under United States Sentencing
Guideline § 3C1.1 for obstruction of justice and denied his request for a sentence
reduction under U.S.S.G. § 3E1.1 for acceptance of responsibility. We exercise
jurisdiction under 28 U.S.C. § 1291 and affirm.
The criminal activity for which Mr. Cone received a six-count indictment
involved his conduct in giving several banks false information in order to secure
loans. The banks did not adequately verify this information and extended loans to
Mr. Cone in an amount totaling over one million dollars during an eight-month
period. Following an investigation, authorities subsequently issued an indictment
against Mr. Cone. Pursuant to a plea agreement, Mr. Cone pled guilty to one
count of the indictment for bank fraud under 18 U.S.C. 1344(1).
In an interview with the probation officer, Mr. Cone admitted his criminal
conduct and provided a statement consistent with the facts of the case. He later
also provided information on payments he made on the loans for the purpose of
determining the correct amount owed in restitution. Among the information and
documents provided, Mr. Cone gave the probation officer two checks drawn on
his account at Islanders Bank. On the first check, made payable to Islanders Bank
-2- in the amount of $7,274.62, Mr. Cone wrote “Payment 219040961,” which is the
loan number for the loan Mr. Cone received from that bank. However, the
probation officer determined, as verified by Mr. Cone’s counsel at the sentencing
hearing, that Mr. Cone made the notation prior to giving the check to the
probation officer and did not use the check to make a payment on the loan, but
rather to purchase a $7,200 cashier’s check made payable to a third party. The
probation officer found Mr. Cone made the notation in an attempt to reduce the
amount of restitution payable to his victims.
Mr. Cone gave the second check, made payable to Skagit Bank in the
amount of $500, to the probation officer with the representation he used it to
make a payment on a loan with that bank. However, Mr. Cone actually deposited
the check into his account at that bank and received $300 in cash back from the
deposit, instead of making a payment on his loan. In fact, Mr. Cone himself
never made a payment on either of the two loans in question.
Based on these facts, the probation officer found Mr. Cone’s conduct
constituted an attempt to obstruct the presentence investigation by providing
materially false information, thereby qualifying him for a two-level increase in his
sentence for obstruction of justice and making him ineligible for a reduction for
-3- acceptance of responsibility. Mr. Cone objected to the presentence report, noting
the two checks he inadvertently misrepresented constituted only a part of his
ongoing effort to assist the probation office, and he submitted them knowing the
probation office would independently verify them. He also argued submission of
the two checks did not affect his acknowledgment of wrongdoing, because he
submitted them only in an attempt to determine what amount he owed in
restitution to his victims.
The district court found Mr. Cone qualified for an obstruction of justice
increase in his sentence under U.S.S.G. § 3C1.1. In so finding, the district court
rejected Mr. Cone’s objections to the presentence report as well as his sentencing
hearing argument that no evidence showed a willful or knowing attempt to
mislead the probation officer. Specifically, the district court rejected Mr. Cone’s
hearing argument that he did not willfully attempt to mislead because (1) most of
the information he provided correctly showed a reduction of the restitution
amount; (2) he knew the probation officer would investigate and verify the
amount; (3) he would not intentionally risk increasing his sentencing for a mere
$7,000 deduction in restitution; and (4) he could not recall the circumstances of
his loan repayments given the amount and number of loans he received. In
rejecting these contentions, the district court also found Mr. Cone ineligible for a
-4- § 3E1.1 reduction in his sentence for acceptance of responsibility. The district
court noted only rare circumstances permit eligibility for such a reduction when
obstruction of justice occurs. The district court found no rare circumstance
existed and that Mr. Cone’s conduct in falsely representing the checks, for the
purpose of reducing his restitution amount, was consistent with his conduct in
providing the banks with false information to obtain the loans. The district court
sentenced Mr. Cone to twenty-two months in prison. 1
On appeal, Mr. Cone renews the same arguments presented to and
addressed by the district court. Most specifically, he renews his contention no
evidence of willfulness existed to support the sentence increase for obstruction of
justice. He also claims he is eligible for a reduction in his sentence for
acceptance of responsibility, regardless of whether he obstructed justice, because
this is an “extraordinary case” and his conduct in presenting the checks was not
inconsistent with his acceptance of responsibility.
A. Obstruction of Justice
We review the district court’s factual determinations on obstruction of
1 As Mr. Cone requested, the district court sentenced him to the low end of the sentencing range of twenty-one to twenty-seven months in prison.
-5- justice for clear error, giving due deference to the district court’s application of
the sentencing guidelines to the facts. United States v. Hankins, 127 F.3d 932,
934 (10th Cir. 1997). We review de novo the district court’s legal interpretation
of the sentencing guidelines. Id. United States Sentencing Guideline § 3C1.1
Free access — add to your briefcase to read the full text and ask questions with AI
F I L E D United States Court of Appeals Tenth Circuit UNITED STATES COURT OF APPEALS JAN 31 2000 TENTH CIRCUIT __________________________ PATRICK FISHER Clerk
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 99-5162 (N.D. Okla.) BARRY W. CONE, (D.Ct. No. 98-CR-178-H)
Defendant-Appellant. ____________________________
ORDER AND JUDGMENT *
Before BRORBY, EBEL, and LUCERO, Circuit Judges.
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is
therefore ordered submitted without oral argument.
Appellant Barry W. Cone appeals his sentence after pleading guilty to one
* This order and judgment is not binding precedent except under the doctrines of law of the case, res judicata and collateral estoppel. The court generally disfavors the citation of orders and judgments; nevertheless, an order and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3. count of bank fraud under 18 U.S.C. § 1344. On appeal, Mr. Cone argues the
district court improperly increased his sentence under United States Sentencing
Guideline § 3C1.1 for obstruction of justice and denied his request for a sentence
reduction under U.S.S.G. § 3E1.1 for acceptance of responsibility. We exercise
jurisdiction under 28 U.S.C. § 1291 and affirm.
The criminal activity for which Mr. Cone received a six-count indictment
involved his conduct in giving several banks false information in order to secure
loans. The banks did not adequately verify this information and extended loans to
Mr. Cone in an amount totaling over one million dollars during an eight-month
period. Following an investigation, authorities subsequently issued an indictment
against Mr. Cone. Pursuant to a plea agreement, Mr. Cone pled guilty to one
count of the indictment for bank fraud under 18 U.S.C. 1344(1).
In an interview with the probation officer, Mr. Cone admitted his criminal
conduct and provided a statement consistent with the facts of the case. He later
also provided information on payments he made on the loans for the purpose of
determining the correct amount owed in restitution. Among the information and
documents provided, Mr. Cone gave the probation officer two checks drawn on
his account at Islanders Bank. On the first check, made payable to Islanders Bank
-2- in the amount of $7,274.62, Mr. Cone wrote “Payment 219040961,” which is the
loan number for the loan Mr. Cone received from that bank. However, the
probation officer determined, as verified by Mr. Cone’s counsel at the sentencing
hearing, that Mr. Cone made the notation prior to giving the check to the
probation officer and did not use the check to make a payment on the loan, but
rather to purchase a $7,200 cashier’s check made payable to a third party. The
probation officer found Mr. Cone made the notation in an attempt to reduce the
amount of restitution payable to his victims.
Mr. Cone gave the second check, made payable to Skagit Bank in the
amount of $500, to the probation officer with the representation he used it to
make a payment on a loan with that bank. However, Mr. Cone actually deposited
the check into his account at that bank and received $300 in cash back from the
deposit, instead of making a payment on his loan. In fact, Mr. Cone himself
never made a payment on either of the two loans in question.
Based on these facts, the probation officer found Mr. Cone’s conduct
constituted an attempt to obstruct the presentence investigation by providing
materially false information, thereby qualifying him for a two-level increase in his
sentence for obstruction of justice and making him ineligible for a reduction for
-3- acceptance of responsibility. Mr. Cone objected to the presentence report, noting
the two checks he inadvertently misrepresented constituted only a part of his
ongoing effort to assist the probation office, and he submitted them knowing the
probation office would independently verify them. He also argued submission of
the two checks did not affect his acknowledgment of wrongdoing, because he
submitted them only in an attempt to determine what amount he owed in
restitution to his victims.
The district court found Mr. Cone qualified for an obstruction of justice
increase in his sentence under U.S.S.G. § 3C1.1. In so finding, the district court
rejected Mr. Cone’s objections to the presentence report as well as his sentencing
hearing argument that no evidence showed a willful or knowing attempt to
mislead the probation officer. Specifically, the district court rejected Mr. Cone’s
hearing argument that he did not willfully attempt to mislead because (1) most of
the information he provided correctly showed a reduction of the restitution
amount; (2) he knew the probation officer would investigate and verify the
amount; (3) he would not intentionally risk increasing his sentencing for a mere
$7,000 deduction in restitution; and (4) he could not recall the circumstances of
his loan repayments given the amount and number of loans he received. In
rejecting these contentions, the district court also found Mr. Cone ineligible for a
-4- § 3E1.1 reduction in his sentence for acceptance of responsibility. The district
court noted only rare circumstances permit eligibility for such a reduction when
obstruction of justice occurs. The district court found no rare circumstance
existed and that Mr. Cone’s conduct in falsely representing the checks, for the
purpose of reducing his restitution amount, was consistent with his conduct in
providing the banks with false information to obtain the loans. The district court
sentenced Mr. Cone to twenty-two months in prison. 1
On appeal, Mr. Cone renews the same arguments presented to and
addressed by the district court. Most specifically, he renews his contention no
evidence of willfulness existed to support the sentence increase for obstruction of
justice. He also claims he is eligible for a reduction in his sentence for
acceptance of responsibility, regardless of whether he obstructed justice, because
this is an “extraordinary case” and his conduct in presenting the checks was not
inconsistent with his acceptance of responsibility.
A. Obstruction of Justice
We review the district court’s factual determinations on obstruction of
1 As Mr. Cone requested, the district court sentenced him to the low end of the sentencing range of twenty-one to twenty-seven months in prison.
-5- justice for clear error, giving due deference to the district court’s application of
the sentencing guidelines to the facts. United States v. Hankins, 127 F.3d 932,
934 (10th Cir. 1997). We review de novo the district court’s legal interpretation
of the sentencing guidelines. Id. United States Sentencing Guideline § 3C1.1
mandates a two-level offense increase if Mr. Cone “willfully obstructed or
impeded, or attempted to obstruct or impede, the administration of justice during
the course of the investigation, prosecution, or sentencing” of his offense. This
includes “providing materially false information to a probation officer in respect
to a presentence or other investigation for the court.” U.S.S.G. § 3C1.1,
comment. (n.4(h)).
After reviewing the record and these standards, we hold the district court’s
finding Mr. Cone misrepresented the purpose of the checks at issue was not
clearly erroneous. Mr. Cone’s contention he unintentionally misrepresented the
checks as loan payments because he could not recall the circumstances of all his
loan repayments, seems incredible given he never made payments on the loans
involved. Moreover, the fact he made a notation of the loan number on the
$7,274.62 check, just prior to presenting it to the probation officer as a loan
payment, shows a wilful intent to misrepresent the purpose of the check. If Mr.
Cone had been unsure of the check’s purpose, or confused over the circumstances
-6- of his loan payments as alleged, it seems more likely he would have indicated this
to his attorney and the probation officer when he presented them the check, rather
than marking the loan number on it without explanation. Thus, we have little
difficulty concluding Mr. Cone, in trying to decrease the amount of restitution
owed, misrepresented the purpose of the checks during the course of the probation
officer’s investigation. Because Mr. Cone made a material misrepresentation, we
find it irrelevant whether other information Mr. Cone provided legitimately
assisted the probation officer or whether Mr. Cone thought the probation officer
might verify the payments. For these reasons, we conclude the district court did
not err in increasing Mr. Cone’s sentence under § 3C1.1 for obstruction of justice.
B. Acceptance of Responsibility
The district court has broad discretion to determine whether to award Mr.
Cone a sentence reduction under U.S.S.G. § 3E1.1 for acceptance of
responsibility, and we will not disturb its decision absent clearly erroneous
findings. United States v. Bindley, 157 F.3d 1235, 1240 (10th Cir. 1998), cert.
denied, 119 S. Ct. 1086 (1999); see also U.S.S.G. § 3E1.1, comment. (n.5). We
may overturn the district court’s acceptance of responsibility determination only
if it is without foundation. United States v. Amos, 984 F.2d 1067, 1071-72 (10th
Cir. 1993). Mr. Cone “bears the burden of establishing entitlement to a reduction
-7- under § 3E1.1.” Bindley, 157 F.3d at 1241. To receive a reduction, Mr. Cone
“must show recognition and affirmative acceptance of personal responsibility for
his criminal conduct.” Id. (quotation marks and citation omitted). “[A] defendant
who falsely denies, or frivolously contests, relevant conduct that the court
determines to be true has acted in a manner inconsistent with acceptance of
responsibility.” U.S.S.G. § 3E1.1, comment. (n.1(a)). Except in “extraordinary
cases,” conduct resulting in a sentence enhancement for obstruction of justice
ordinarily indicates the defendant has not accepted responsibility for his criminal
conduct. See U.S.S.G. § 3E1.1, comment. (n.4).
Given Mr. Cone’s intentional misrepresentation of the checks at issue, and
his repeated refusal to admit to his intentional misrepresentation, we can hardly
conclude this is an “extraordinary case” warranting a downward adjustment for
acceptance of responsibility for his criminal conduct. Moreover, we find Mr.
Cone’s obstructive conduct, in attempting to reduce the restitution he owes the
“victim banks,” is inconsistent with his acceptance of responsibility for
defrauding those same banks. Thus, sufficient foundation exists for the district
court’s decision not to apply a sentence reduction for acceptance of responsibility
under U.S.S.G. § 3E1.1.
-8- For these reasons, we AFFIRM the sentence imposed by the district court.
Entered by the Court:
WADE BRORBY United States Circuit Judge
-9-