United States v. Gilberg

UNITED STATES COURT OF APPEALS UNITED STATES COURT OF APPEALS

FOR THE FIRST CIRCUIT FOR THE FIRST CIRCUIT

No. 95-1586

UNITED STATES OF AMERICA,

Plaintiff, Appellee,

v.

GARY S. GILBERG,

Defendant, Appellant.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MASSACHUSETTS

[Hon. Douglas P. Woodlock, U.S. District Judge]

Selya, Cyr and Stahl,

Circuit Judges.

Gary C. Crossen, with whom Toni G. Wolfman, Mark D. Rosen, Cindy

M. Lott and Foley, Hoag & Eliot were on brief for appellant.

Wan J. Kim, Attorney, Department of Justice, with whom Donald K.

Stern, United States Attorney, Mark D. Seltzer, Acting Director, New

England Bank Fraud Task Force, and James P. Gillis, Trial Attorney,

New England Bank Fraud Task Force, were on brief for appellee.

January 31, 1996

CYR, Circuit Judge. Defendant Gary S. Gilberg chal- CYR, Circuit Judge.

lenges several district court rulings relating to his trial and

sentencing for conspiring to make, and making, false statements

to financial institutions in order to procure mortgage loan

financing, see 18 U.S.C. 371 & 1014. We affirm all but the

restitutionary sentence.

I I

BACKGROUND BACKGROUND

During the 1980s, after borrowing almost $5 million

which he agreed to repay from future condominium sale proceeds,

Gilberg launched Chancery Court, a forty-unit condominium project

in Lynn, Massachusetts. Condominium sales did not proceed apace,

however, and Gilberg decided to lure prospective buyers by

promising to obtain 100% mortgage financing for them, obviating

the need for down payments. To this end, Gilberg would inflate

the purchase price stated on the sales agreement which he submit-

ted to the bank in support of the buyer's mortgage loan applica-

tion. A so-called "amended" sales agreement, containing the true

purchase price, would be retained in Gilberg's private files, and

the buyer was told not to mention the "amendment" to the bank.

On other occasions, Gilberg provided prospective buyers with

second mortgage financing, which he concealed from the first-

mortgage lenders by instructing his attorney not to record the

second mortgages, or to record them late. Gilberg attended each

loan closing, personally signing HUD-1 settlement statements

which he knew to contain false information. These means enabled

2

Gilberg to sell thirty-seven condominium units, which were

financed through various banks.

In August 1993, Gilberg was indicted in one count for

conspiring to make false statements on twenty-one loan applica-

tions to three FDIC-insured financial institutions, see 18 U.S.C.

371, and in thirteen counts for making false statements to

FDIC-insured institutions, see id. 1014. Several condominium

buyers, as well as Gilberg's attorney, testified that Gilberg

originated and orchestrated the scheme. The jury convicted on

all counts and the district court sentenced Gilberg to thirty-six

months' imprisonment and ordered $3,635,000 in restitution.

II II

DISCUSSION DISCUSSION

A. The Trial Related Rulings A. The Trial Related Rulings

1. "Good faith" Jury Instruction 1. "Good faith" Jury Instruction

Gilberg first contends that the final jury instruction

misdefined the mens rea element in 18 U.S.C. 1014, which

criminalizes "knowingly mak[ing] any false statement or report .

. . for the purpose of influencing in any way the action of . . .

any [FDIC-insured bank] . . . upon any application, advance, . .

. commitment, or loan." (Emphasis added.) Gilberg argues that

section 1014 affords a "good faith" defense where the defendant

knew the statement or report contained false information but

acted without the "bad" purpose to influence the bank's actions.

He proffered evidence that he knew and believed, at the time of

the various loan applications, that the prevailing banking

3

practice was to approve or disapprove applications based solely

on the appraised value of the real property securing the loan,

rather than on whether the real estate sale itself involved price

"discounts" or secondary mortgage financing. Thus, Gilberg

argues, the district court hobbled his defense by instructing the

jury that "a defendant does not act in good faith even if he

honestly holds a particular opinion or belief and, yet, knowingly

makes false and fraudulent statements or misrepresentations."

Gilberg concededly raised no objection to the jury

instruction. See Fed. R. Crim. P. 51. Consequently, we review

for plain error, see Fed. R. Crim. P. 52(b), and may reverse only

if (i) the final jury instruction constituted error (ii) which

was or should have been "obvious" in the sense that the governing

law was clearly settled to the contrary, and (iii) appellant

proves that the error resulted in "prejudice," or in other words,

that it affected his substantial rights. See United States v.

Hurley, 63 F.3d 1, 9 (1st Cir. 1995) (citing United States v.

Olano, 113 S. Ct. 1770, 1777 (1993)). Even if these three

criteria are met, however, we do not "notice the error unless it

caused `a miscarriage of justice' or [seriously] undermined `the

integrity or public reputation of judicial proceedings.'" Id.

(citations omitted).

Though the statutory interpretation posited by Gilberg

is dubious at best, cf., e.g., United States v. Wilcox, 919 F.2d

109, 112 (9th Cir. 1990) ("The requisite intent [under 1014] is

the intent to influence an action, and nothing more."), we do not

4

reach the merits. Gilberg cites to no authority let alone to

a controlling United States Supreme Court or First Circuit

decision clearly holding that the "good faith" instruction

given below contained an erroneous statement of the mens rea

requirement under section 1014. See Olano, 113 S. Ct. at 1777

("At a minimum, the Court of Appeals cannot correct an error

pursuant to Rule 52(b) unless the error is clear under current

law.") (emphasis added).1 Hence, any error in the challenged

instruction was neither "obvious," nor cognizable under Criminal

Rule 52(b).

2. Motion in Limine 2. Motion in Limine

Gilberg next assigns error in the district court order

precluding evidence that the defrauded banks had relied exclu-

sively on property appraisals in determining whether to approve

loan applications, and not on the apparent absence of "discounts"

and second mortgage financing. He claims that this ruling

prejudiced him because the excluded evidence would have bolstered

his "good faith" defense. See supra Section II.A.1.2

1Morissette v. United States, 342 U.S. 246 (1952), and Cheek

v. United States, 498 U.S. 192 (1991), are inapposite. Even if

Gilberg's interpretation of the "purpose" clause in 1014 were

correct, he cannot seriously contend that the one clear mens rea

element in 1014 "knowingly" communicating false statements

does not criminalize conduct a normal person readily would

recognize as culpable.

2We do not understand Gilberg to argue that the excluded

evidence was relevant to the discredited "complicity" defense,

namely, that any bank officials' knowing participation in the

scheme would exonerate Gilberg under 1014. See United States

v. Johnson, 585 F.2d 119, 124 (5th Cir. 1978) (rejecting complic-

ity defense, and noting that the "[t]he savings and loan's

awareness of the fraud is not relevant, for its existence is not

5

Once again we review for plain error, since Gilberg

first raised this claim on appeal. See Hurley, 63 F.3d at 9. As

there was no plain error in rejecting the "good faith" defense

instruction, a fortiori there can have been no plain error in

excluding evidence offered in support. Furthermore, given

Gilberg's concession that a representative sampling of this "good

faith" evidence was admitted at trial, he has failed to demon-

strate "prejudice." Olano, 113 S. Ct. at 1778 (noting that,

unlike Rule 52(a), Rule 52(b) provides that "the defendant rather

than the Government . . . bears the burden of persuasion with

respect to prejudice") (emphasis added).

B. The Sentencing Rulings B. The Sentencing Rulings

1. Amount of Loss (U.S.S.G. 2F1.1) 1. Amount of Loss (U.S.S.G. 2F1.1)

Gilberg contends that the district court committed

three errors in calculating the amount of loss under the then-

applicable version of U.S.S.G. 2F1.1, and that the combined

effect of its miscalculations ballooned the total loss from $1-2

million to the $2-5 million range, which in turn led the court to

make a ten-level (rather than a nine-level) upward adjustment in

inconsistent with the intent to influence which a violator of

1014 must possess"). Nor do we understand Gilberg to argue for

the similarly discredited "lack of reliance" defense, namely,

that his purpose to influence was immaterial because the banks

did not, in the end, actually rely on his false statements in

approving the loan applications. See United States v. Norberg,

612 F.2d 1, 4 (1st Cir. 1979) (expressly rejecting such a de-

fense).

6

his base offense level of six.3

First, Gilberg argues that the loss calculation should

not have included $726,637 in accrued mortgage loan interest.

See U.S.S.G. 2F1.1, comment. (n.7) (excluding from the loss

calculation the "interest the victim could have earned"); United

States v. Hoyle, 33 F.3d 415, 419 (4th Cir. 1994). But the

settled law in this circuit is to the contrary. See United

States v. Goodchild, 25 F.3d 55, 66-67 (1st Cir. 1994) (holding

that accrued finance charges on credit cards are not lost "oppor-

tunity costs," and may be included in amount of loss) (citing

United States v. Lowder, 5 F.3d 467, 471 (10th Cir. 1993)).

Gilberg's attempt to distinguish Goodchild is unavailing. As the

Goodchild panel's citation to Lowder and other authority makes

clear, we have found no principled difference between interest

earned on a credit card (a/k/a "finance charges") and interest

earned on other types of loans. See Hurley, 63 F.3d at 9 (noting

that newly-constituted panels are bound by a prior panel decision

on point). Since it was proper to include the $726,637 in

interest as part of the loss, the other loss calculation errors

raised on appeal need not be addressed because the unimpeachable

loss totalled no less than $2,669,065, well within the $2-5

million range necessary to trigger a ten-level upward adjustment.

3Although normally a loss determination under U.S.S.G.

2F1.1 is fact-based and subject to clear error review, see United

States v. Goodchild, 25 F.3d 55, 64 (1st Cir. 1994), Gilberg

challenges the district court's interpretation of a sentencing

guideline. Therefore, review is de novo. See id.; see also

United States v. Ovalle-Marquez, 36 F.3d 212, 221 (1st Cir.

1994), cert. denied, 115 S. Ct. 1322 (1995).

7

2. The "Role in Offense" Enhancement 2. The "Role in Offense" Enhancement

Gilberg challenges the four-level upward adjustment

based on his role in the offense, see U.S.S.G. 3B1.1, contend-

ing that the government improperly singled him out for prosecu-

tion by cutting deals with the real "leaders" of the Chancery

Court scheme his attorney and a business partner. Second, he

complains that the district court failed to make express findings

of fact regarding the comparative responsibilities of the partic-

ipants in the scheme. We review for "clear error," see United

States v. Akitoye, 923 F.2d 221, 227 (1st Cir. 1991), mindful

that "battles over a defendant's [role in the offense] . . . will

almost always be won or lost in the district court," United

States v. Graciani, 61 F.3d 70, 75 (1st Cir. 1995). Gilberg's

case is no exception.

Gilberg concedes that the evidence could support a

rational inference that he orchestrated the criminal conduct

alleged in the indictment. The evidence disclosed that he was a

sophisticated real estate developer who supplied false purchase

prices to his attorney, instructed his attorney and prospective

buyers to conceal his false statements, and secreted the documen-

tation containing the actual terms. Gilberg cites no authority

nor is there any for the proposition that a sentencing

court must compare the responsibilities of all participants

before imposing a U.S.S.G. 3B1.1 enhancement against a defen-

dant. Moreover, in crediting the evidence that Gilberg played

8

the pivotal role in the initial success of the Chancery Court

scheme, the district court implicitly found that Gilberg was an

"organizer," regardless of the precise roles played by each

cohort. See U.S.S.G. 3B1.1, comment. (n.4) (noting that an

offense may involve "more than one person who qualifies as a

leader or organizer"); United States v. Tejeda-Beltran, 50 F.3d

105, 111-13 (1st Cir. 1995) ("We hold that retention of control

over other participants, although sometimes relevant to an

inquiry into the status of a putative organizer, is not an

essential attribute of organizer status."); cf. U.S.S.G. 3B1.1,

comment. (n.2) (authorizing upward departure for "management

responsibility over the property, assets, or activities of a

criminal organization," even though defendant neither led nor

supervised any other participant). 3. The Victim and Wit- 3. The Victim and Wit-

ness Protection Act ness Protection Act

Finally, Gilberg claims that the restitutionary sen-

tence overstates victim loss because the class of "victims" is

too broad. He points out that the sentencing court ordered

restitution in connection with all thirty-one loans, whereas the

indictment charged him in relation to only twenty-one loans.

The government concedes that the last criminal conduct

involving Gilberg took place no later than June 1990. The Victim

and Witness Protection Act ("VWPA"), 18 U.S.C. 3663-3664

(1990), governs restitution in criminal cases. See, e.g., United

States v. DeSalvo, 41 F.3d 505, 511 (9th Cir. 1994). In June

1990, the VWPA provided that the district court in sentencing

9

"a defendant convicted of an offense" may order "restitution

to any victim of such offense." 18 U.S.C. 3579(a)(1)(1982)

(emphasis added); see 18 U.S.C. 3579-3780 (1987), amended by

18 U.S.C. 3663-3664 (1990). In Hughey v. United States, 495

U.S. 411 (1990), the defendant had been charged, in multiple

counts, with theft and unauthorized use of credit cards, offenses

which caused victim losses totaling $90,431. Although Hughey

pled guilty to but one count of unauthorized use of a single

credit card, which caused $10,412 in victim loss, id. at 414, the

district court ordered $90,431 in restitution. Reversing, the

Supreme Court held that "the language and structure of the [VWPA]

make plain Congress' intent to authorize an award of restitution

only for the loss caused by the specific conduct that is the

basis of the offense of conviction." Id. at 413, 422 n.5.

Effective November 29, 1990, Congress broadened the

VWPA definition of "victim," see Pub. L. No. 101-647, 2509, 104

Stat. 4789, 4863, 4931 (Nov. 29, 1990) (Crime Control Act of

1990) (codified at 18 U.S.C. 3663(a)(2)), thereby effectively

overruling Hughey in part. Section 3663(a)(2) now provides that

"a victim of an offense that involves as an element a scheme, a

conspiracy, or a pattern of criminal activity means any person

directly harmed by the defendant's criminal conduct in the course

of the scheme, conspiracy, or pattern." 18 U.S.C. 3663(a)(2)

(emphasis added). See generally United States v. Neal, 36 F.3d

1190, 1200 (1st Cir. 1994).

The district court ordered Gilberg to make restitution

10

to banks other than the three FDIC-insured banks involved in the

twenty-one insured loans which formed the entire basis for the

conspiracy and the substantive counts upon which Gilberg was

convicted. The parties agree that, under the 1987 version of the

VWPA as interpreted in Hughey, the restitution order imposed on

Gilberg would be improper, and that "approximately $2 million"

would be the maximum permissible "victim loss" calculation.

The government nonetheless contends that the district

court order complies with the 1990 VWPA. See Hughey, 495 U.S. at

413 n.1 (normally, the VWPA version in effect at sentencing

controls). Gilberg responds that such a retroactive application

of section 3663(a)(2) to his pre-November 1990 criminal conduct

would violate the Ex Post Facto Clause, U.S. Const. art. I, 9,

cl. 3. See Miller v. Florida, 482 U.S. 423, 430-31 (1987); see

also United States v. Newman, 49 F.3d 1, 10-11 (1st Cir. 1995);

United States v. Cronin, 990 F.2d 663, 666 (1st Cir. 1993).

Normally, we review restitution orders only for "abuse

of discretion." See United States v. Benjamin, 30 F.3d 196, 198

(1st Cir. 1994); United States v. Savoie, 985 F.2d 612, 617 (1st

Cir. 1993). Although a timely challenge to a retroactive appli-

cation of the 1990 VWPA amendments would present a question of

law subject to plenary review, see, e.g., United States v.

Guthrie, 64 F.3d 1510, 1514 (10th Cir. 1995); DeSalvo, 41 F.3d at

511; United States v. Meacham, 27 F.3d 214, 218 (6th Cir. 1994),

Gilberg concedes that he did not object at sentencing. Accord-

ingly, we review only for plain error. See United States v.

11

Tutiven, 40 F.3d 1, 7-8 (1st Cir. 1994), cert. denied, 115 S. Ct.

1391 (1995); United States v. Rodriguez, 938 F.2d 319, 321 (1st

Cir. 1991). As the Rule 52(b) "plain error" test announced in

Olano, 113 S. Ct. at 1776-79, applies to sentencing errors, see

Benjamin, 30 F.3d at 197; supra Section II.A.1, we apply the

Olano "plain error" criteria to the forfeited "victim loss"

calculation claim asserted by Gilberg on appeal.4

a) "Error" a) "Error"

The first Olano criterion that there be "error,"

Olano, 113 S. Ct. at 1777 is readily met here. Retroactive

application of VWPA 3663(a)(2) would violate the Ex Post Facto

Clause, since it would "make[] more burdensome the punishment for

[Gilberg's] crime[s], after [their] commission . . . ." Dobbert

v. Florida, 432 U.S. 282, 292 (1977) (emphasis added); see also

United States v. Johnson, 952 F.2d 565, 585 (1st Cir. 1991),

cert. denied, 113 S. Ct. 58 (1992). As an order of restitution

is part of the criminal sentence, we reject the suggestion that

the November 1990 VWPA amendments may be applied against Gilberg.

See, e.g., United States v. Jewett, 978 F.2d 248, 252-53 (6th

Cir. 1992) (rejecting retroactivity argument); see also United

States v. Elliott, 62 F.3d 1304, 1313-14 (11th Cir. 1995) (same);

DeSalvo, 41 F.3d at 515 (same).

4Given the concession by the government that application of

Hughey would result in a $1.6 million reduction in the restitu-

tion order, we conclude that Gilberg has shouldered his burden on

the third Olano factor "prejudice." See supra Section II.A.1.

We therefore confine our "plain error" analysis to the three

remaining Olano factors (i.e., error, "obviousness," and "mani-

fest miscarriage of justice").

12

b) Obviousness of Error b) Obviousness of Error

The government argues that retroactive application of

the 1990 VWPA amendments would not constitute "obvious" error,

see Olano, 113 S. Ct. at 1777, because this court had yet to

weigh in on the retroactivity question by the time Gilberg was

sentenced, and other courts of appeals were divided. Compare

Jewett, 978 F.2d at 252-53, with United States v. Rice, 954 F.2d

40 (2d Cir. 1992); United States v. Arnold, 947 F.2d 1236 (5th

Cir. 1991) (per curiam). We disagree.

The Rice and Arnold cases are factually and legally

inapposite to the present context. The retroactivity issue in

Rice ultimately turned on a different 1990 VWPA amendment not

implicated in our case which provided that "[t]he court may

also order restitution in any criminal case to the extent agreed

to by the parties in a plea agreement." 18 U.S.C. 3663(a)(3)

(emphasis added). The plea agreement in Rice expressly provided

for restitution both to victims of the dismissed counts and

victims of uncharged criminal conduct, Rice, 954 F.2d at 41-42,

and the plea predated both the 1990 VWPA amendments and Hughey.

Thus, settled Second Circuit precedent supported the expansive

victim loss calculation agreed to by Rice. Id. at 44. The

Second Circuit rejected Rice's ex post facto argument because (1)

Rice must have relied on the more onerous Second Circuit case

law, rather than on Hughey, when he agreed to the broad restitu-

tion commitment adopted in the plea agreement; and (2) section

3663(a)(3) did not retroactively "enhance the punishment for an

13

offense" but "merely provided that a specified type of plea

agreement could be enforced from that point on." Id.

The Fifth Circuit employed the same analysis in Arnold,

947 F.2d at 1238 n.2, noting that section 3663(a)(3) was not

retroactive but "applied prospectively to validate Arnold's

[earlier] plea agreement." The government cites no apposite

circuit court authority holding that section 3663(a)(2) applies

retroactively to pre-November 1990 criminal conduct.

As the government correctly notes, we have yet to

address this precise question. In Cronin, 990 F.2d at 663, the

government did not contend that section 3663(a)(2) should be

applied retroactively to pre-November 1990 conduct, urging

instead that Hughey is distinguishable from cases involving

convictions for "offense[s]" like mail fraud which require,

as an essential element, proof of a broader "scheme to defraud."

See id. at 666; see also, e.g., 18 U.S.C. 1341. Given the

inherent breadth of the "offense" of conviction in Cronin, the

government argued that VWPA restitution was not limited to losses

caused by the particular mailings designated in the individual

counts upon which the defendant was convicted, but included all

victim losses occasioned by the larger fraud "scheme." Noting a

circuit split on the issue, we sided with the majority rule, and

concluded that Hughey barred the broader restitution order.

Cronin, 990 F.2d at 666; see also Newman, 49 F.3d at 11 (applying

Cronin pronouncement to wire fraud conviction).

The implicit concessions of nonretroactivity in Cronin

14

and Newman apparently stemmed from the government's acknowl-

edgement that retroactive application of section 3663(a)(2) would

have had no colorable basis in the decisional law construing the

Ex Post Facto Clause. See id. at 11 n.14 (noting that, "[a]s the

offenses occurred in 1989 and early 1990, Newman is subject to

the restitution statute as it stood prior to amendment in Novem-

ber of 1990"). Further, had this court been satisfied that the

1990 VWPA amendments were readily amenable to retroactive appli-

cation in Cronin and Newman, we could have affirmed those restit-

utionary sentences on that alternative ground. See United States

v. Alzanki, 54 F.3d 994, 1008 (1st Cir. 1995), petition for cert.

filed, 64 U.S.L.W. 3298 (U.S. Oct. 16, 1995) (No. 95-619) (appel-

late court may affirm district court on any ground supported by

record); cf. also Jewett, 978 F.2d at 252 (finding that Hughey

precluded broad restitution order, before addressing VWPA retro-

activity question, even though the latter issue had not been

addressed by parties). Based on the clear language of the 1987

VWPA and the unanimous circuit precedents rejecting the govern-

ment's retroactivity claim, see supra Section II.B.3.a, we hold

that the error in this case satisfied the "obviousness" test

announced in Olano.5 See United States v. Weiner, 3 F.3d 17, 24

5It is noteworthy that the Olano Court explicitly reserved

decision on whether an error that becomes clear after trial, but

prior to review by the court of appeals, may be considered

"obvious." Olano, 113 S. Ct. at 1777. ("At a minimum, the Court

of Appeals cannot correct an error pursuant to Rule 52(b) unless

the error is obvious under current law."). As in Olano, we need

not resolve this question because we have found, given the

unanimous case law, that it was already "obvious" at the time of

sentencing that Gilberg should not be held responsible under the

15

n.5 (1st Cir. 1993) (noting that a circuit split may rule out a

finding that forfeited error was "obvious," even if First Circuit

has not weighed in on issue).

c) "Miscarriage of Justice" c) "Miscarriage of Justice"

Although Olano entrusts remediation of plain error to

the sound discretion of the reviewing court, the courts of

appeals "should not" exercise their discretion unless a forfeited

error results in "`a miscarriage of justice,' or "`seriously

affect[s] the fairness, integrity or public reputation of judi-

cial proceedings.'" Olano, 113 S. Ct. at 1776 (citations omit-

ted).

In all events, the VWPA expressly limits restitutionary

relief to "victims of [the] offense [of conviction]." 18 U.S.C.

3662(a)(1) (emphasis added). A federal court has no inherent

authority to order restitution in a criminal case; it may do so

only as expressly provided by statute. DeSalvo, 41 F.3d at 511.

We have noted that when the district court fundamentally departs

from "obvious" sentencing principles, "the situation corresponds

mutatis mutandis to one in which a forfeited error may have

caused the conviction of an innocent person, the other rubric

under which a plain and prejudicial error should be noticed on

appeal." United States v. Whiting, 28 F.3d 1296, 1312 (1st Cir.)

(citing Olano, 113 S. Ct. at 1779) (emphasis added), cert.

denied, 115 S. Ct. 378 (1994). Given the particular circum-

1987 VWPA for losses occasioned victims of offenses with which he

was not charged, nor held retroactively responsible under the

1990 VWPA amendments. See supra Section II.B.3(a), (b).

16

stances of this case, and the substantial $1.6 million reduction

in restitution portended by Hughey's application, we find plain

error warranting vacatur of the restitutionary sentence in this

case.6 The restitution award is reduced to $2,107,406.00,

comprising the total estimated loss on the twenty-one mortgage

loans designated in the indictment.7

The sentence is modified to require restitution in the

amount of $2,107,406. The district court judgment is affirmed,

as modified.

6Gilberg's remaining challenges to the restitution order do

not meet the "plain error" standard. First, he argues that the

district court erroneously assessed the loss occasioned the

lenders by using the price the lender received on resale follow-

ing foreclosure, rather than the foreclosure price bid by the

lender. This issue has not yet been addressed in the First

Circuit. The circuit court decisions cited by Gilberg are

inapposite, simply holding that the sentencing court should be

wary of basing restitution on the resale price where the lender

acquired real estate at foreclosure but does not resell for

years. See, e.g., United States v. Holley, 23 F.3d 902, 914 (5th

Cir. 1994) (six years). Here, however, there is no evidence that

Gilberg's victims held the property for such extended periods

following foreclosure. Consequently, any error in the victim

loss calculation, or the standard employed, has not been shown to

be "obvious."

Second, Gilberg contends that the district court failed to

make explicit findings on his ability to pay restitution. See 18

U.S.C. 3664(a). Nevertheless, we have held that such findings

need not be explicit. See Newman, 49 F.3d at 10 (citing Savoie,

985 F.2d at 618). Moreover, the district court supportably found

that Gilberg's earning potential would enable him to meet his

considerable restitutionary obligations in the future. Id. at

10-11.

7Since loss calculations under U.S.S.G. 2F1.1 are based on

criteria different from the VWPA victim loss criteria, see, e.g.,

id. 2B1.3 (providing that "relevant conduct," for guideline

sentencing purposes, may encompass conduct not charged in indict-

ment, and conduct underlying the counts upon which defendant was

acquitted), the reduction in Gilberg's restitutionary sentence

requires no readjustment in the offense level. See supra Section

II.B.1.

17