Please ensure Javascript is enabled for purposes of website accessibility

Sentencing — food stamp fraud — relevant conduct

By: WISCONSIN LAW JOURNAL STAFF//December 13, 2011//

Sentencing — food stamp fraud — relevant conduct

By: WISCONSIN LAW JOURNAL STAFF//December 13, 2011//

Listen to this article

United States Court of Appeals

Criminal

Sentencing — food stamp fraud — relevant conduct

Where the storefronts a defendant engaged in food stamp fraud used engaged in virtually no legitimate business, it was not error for the sentencing court to not account for legitimate sales at all in calculating relevant conduct.

“Hussein is correct to the extent he contends that the district court’s loss analysis was incomplete. Merchants mark up the price of the inventory they sell, and by subtracting only the cost of the food from the LINK receipts, the court made no attempt to accurately account for gross profit on legitimate sales. But for several reasons this misstep had no practical effect on the choice between subsections (b)(1)(I) and (b)(1)(H). First, the district court’s loss calculation ignores more than $350,000 in LINK receipts at Route 69 and Spot Chicken, even though the fraud at those two locations was relevant conduct because it was ‘part of the same course of conduct or common scheme or plan as the offense of conviction.’ See U.S.S.G. § 1B1.3(a)(2); United States v. Barnhart, 599 F.3d 737, 748 (7th Cir. 2010); United States v. Swanson, 483 F.3d 509, 514 (7th Cir. 2007). In fact, every cent of the $228,497 in LINK receipts at Spot Chicken was necessarily fraudulent because that establishment had been denied authorization to accept food stamps. Second, the district court’s calculation assumes, to Hussein’s benefit, that legitimate customers used LINK cards to buy all of the food inventory at Spot Mart and Halsted, though bank records show that both stores received a small portion of their proceeds in cash. Third, just as the district court recognized, any adjustment for gross profit on the meager food inventory legitimately sold at these locations would have been too minimal to affect the guidelines calculation. In their applications to the USDA, Hussein and Bazian had estimated $15,000 in monthly sales on food items at Spot Mart and $3,900 in monthly food sales at Halsted. Spot Mart accepted LINK benefits for 18 months, and Halsted accepted LINK benefits for 27 months, so the alternative method approved in Haddad and Alburay would yield estimated legitimate sales totaling $375,300. Subtracting this amount from the LINK receipts at the two locations equals a loss of $1,484,639, well over the $1 million minimum for a 16-level increase. And as far as we can tell from the record, once the relevant conduct from Route 69 and Spot Chicken is added to that figure, the only conclusion to be drawn is that the loss amount calculated by the district court is understated, not overstated.”

Affirmed.

11-2248 U.S. v. Hussein

Appeal from the United States District Court for the Northern District of Illinois, Pallmeyer, J., Manion, J.

Polls

Should Steven Avery be granted a new evidentiary hearing?

View Results

Loading ... Loading ...

Legal News

See All Legal News

WLJ People

Sea all WLJ People

Opinion Digests