Court: Court of Appeals for the Seventh Circuit; August 6, 2013; Federal Appellate Court
Carl McMahan was charged with wire fraud under 18 U.S.C. § 1343 due to his involvement in a mortgage fraud scheme. He pleaded guilty and received an 84-month prison sentence, followed by three years of supervised release. On appeal, McMahan contested the district court's determination that he obstructed justice under U.S.S.G. § 3C1.1 and argued against the denial of acceptance of responsibility credit under U.S.S.G. § 3E1.1, both of which the court affirmed.
From July 2002 to June 2007, McMahan and co-defendants engaged in a scheme involving recruiting straw buyers with good credit but inadequate income to purchase properties without the intention of occupying them or fulfilling mortgage obligations. They provided these buyers with falsified documentation, leading to approximately $403,000 in losses for mortgage lenders.
After receiving target letters from the U.S. Attorney's Office in January 2009, McMahan contacted the Assistant U.S. Attorney regarding potential charges. Following a search warrant executed at his home, where he lived with his girlfriend, McMahan and his girlfriend fled. She was arrested in August 2009 in Milwaukee and eventually revealed their flight was due to McMahan’s awareness of the investigation. McMahan was arrested in February 2010, using an alias while working as a truck driver. He admitted to being on the run but expressed readiness to face charges.
At sentencing, the Presentence Report (PSR) calculated McMahan's offense level as 25, which included enhancements for the monetary loss and use of sophisticated means, as well as a two-level increase for obstruction of justice due to his flight. The district court agreed with this assessment, citing his attempt to evade law enforcement after learning of the investigation, and denied any reduction for acceptance of responsibility based on his actions. The court imposed the lowest sentence within the calculated Guidelines range after considering the relevant factors. McMahan's appeal against the obstruction enhancement and denial of acceptance credit was evaluated under a clear error standard, with the district court's findings upheld.
McMahan willfully fled Illinois and changed his name to avoid prosecution, indicating a calculated effort to evade authorities in light of an imminent indictment. His defense of 'panicked, instinctive flight' is unconvincing, as his actions—relocating to Ohio without his family and adopting an alias—demonstrate an intention to evade law enforcement. Consequently, the district court's decision to apply a 2-level enhancement for obstruction of justice is upheld. McMahan also contends that he should receive credit for acceptance of responsibility despite this enhancement. Generally, a defendant with such an enhancement is deemed not to have accepted responsibility, though exceptions exist in rare cases. McMahan's argument that his guilty plea qualifies as an exceptional circumstance fails, as he incorrectly assumes that pleading guilty automatically entitles him to credit. The district court concluded that McMahan’s flight negated any chance for acceptance of responsibility credit. The court's findings are affirmed, with no errors identified.
