United States v. Karen Gagarin

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA, No. 18-10026

Plaintiff-Appellee,

D.C. No.

v. 3:14-cr-00627-SI-4

KAREN GAGARIN,

Defendant-Appellant. OPINION

Appeal from the United States District Court

for the Northern District of California

Susan Illston, District Judge, Presiding

Argued and Submitted September 9, 2019

San Francisco, California

Filed February 13, 2020

Before: Ronald M. Gould, Carlos T. Bea, and

Michelle T. Friedland, Circuit Judges.

Opinion by Judge Gould;

Concurrence by Judge Friedland

2 UNITED STATES V. GAGARIN

SUMMARY *

Criminal Law

The panel affirmed a conviction for aggravated identity

theft under 18 U.S.C. § 1028A(a)(1), a three-level sentence

enhancement, and the restitution order in a case in which the

defendant and her co-conspirators participated in a scheme

to defraud a life insurance company by submitting fraudulent

insurance applications on behalf of individuals who, in

general, did not intend to apply for life insurance or know

that their identifying information was being used.

The panel rejected the defendant’s challenges to the

district court’s denial of her motion for judgment of acquittal

on the aggravated identity theft count.

The panel held that the defendant “used” a means of

identification under the meaning of § 1028A(a)(1), where

her forgery of her cousin’s signature on a fraudulent

application was central to the fraud and “furthered and

facilitated” its commission.

The panel rejected the defendant’s contention that in

order to show that she acted “without lawful authority” as

required by the statute, the Government must show that her

use of the means of identification was “itself illegal.” The

panel explained that the defendant’s use of her cousin’s

identity during and in relation to the wire fraud was

sufficient.

*

This summary constitutes no part of the opinion of the court. It

has been prepared by court staff for the convenience of the reader.

UNITED STATES V. GAGARIN 3

The panel wrote that the Seventh Circuit’s interpretation

of “another person” in United States v. Spears, 729 F.3d 753

(7th Cir. 2013) (en banc), to mean “a person who did not

consent to the use of the means of identification” contradicts

this court’s holding in United States v. Osuna-Alvarez, 788

F.3d 1183, 1185-86 (9th Cir. 2015) (per curiam). The panel

thus held that even if the defendant had her cousin’s consent

to file an insurance application for her, the panel would

follow this circuit’s precedent to hold that the defendant used

the means of identification of “another person” by using the

identification of another “actual person.”

The panel held that the district court did not abuse its

discretion and commit significant procedural error by

imposing a three-level “manager or supervisor”

enhancement under U.S.S.G. § 3B1.1(b).

Upholding the restitution order, the panel wrote that

there is no indication that the district court employed an

erroneous valuation methodology that focused on a criterion

other than the actual losses of the victim, and held that the

district court did not abuse its discretion by declining to

deduct the purported value of “back-end” accounts from the

restitution award. The panel declined to second-guess the

district court’s imposition of joint and several liability, and

rejected as unavailing the defendant’s contention that the

restitution schedule is internally inconsistent.

Concurring except as to the penultimate paragraph of

Part II.C, Judge Friedland wrote that she is disinclined to

criticize the analysis of the unanimous en banc Seventh

Circuit decision in Spears “on its own terms,” as the majority

does.

4 UNITED STATES V. GAGARIN

COUNSEL

Carmen A. Smarandoiu (argued), Chief, Appellate Unit;

Candis Mitchell, Assistant Federal Public Defender; Steven

G. Kalar, Federal Public Defender; Office of the Federal

Public Defender, San Francisco, California; for Defendant-

Appellant.

Kirstin M. Ault (argued), Assistant United States Attorney;

Merry Jean Chan, Chief, Appellate Section, Criminal

Division; David L. Anderson, United States Attorney;

United States Attorney’s Office, San Francisco, California;

for Plaintiff-Appellee.

OPINION

GOULD, Circuit Judge:

Defendant Karen Gagarin was convicted of conspiracy

to commit wire fraud, wire fraud, and aggravated identity

theft. The district court sentenced her to a total of 36 months

in prison, after concluding that a three-level “manager or

supervisor” sentencing enhancement applied to Gagarin’s

role in the scheme to defraud the American Income Life

Insurance Company (AIL). It also imposed a restitution

order, which held Gagarin jointly and severally liable with

her convicted co-conspirators for the full loss suffered by

AIL. On appeal, Gagarin challenges the district court’s

denial of her post-trial motion for a judgment of acquittal on

the aggravated identity theft count, its imposition of the

three-level sentencing enhancement, and the restitution

order. We affirm.

UNITED STATES V. GAGARIN 5

I.

In late 2011, Benham Halali devised a scheme to defraud

AIL of millions of dollars. Halali ran the San Jose, Fresno,

Roseville, and Concord offices of the Jatoft-Foti Agency

(JFA), the exclusive California sales agent of AIL. Between

September 2011 and Spring 2012, Halali and co-

conspirators in those offices, all independent contractors of

AIL, submitted hundreds of fraudulent insurance

applications to AIL on behalf of individuals who, in general,

did not intend to apply for life insurance or know that their

identifying information was being used. Karen Gagarin was

a General Agent with sales and managerial responsibility in

JFA’s San Jose office, and she ran the office when Halali

was away. It is undisputed that she knowingly participated

in the fraudulent scheme.

The conspiracy took advantage of AIL’s system of

compensating agents for insurance policy sales. For each

policy an agent purportedly sold, the agent received

advanced commissions and bonuses from AIL according to

a specified percentage of the premiums that the policy would

be expected to generate during the year. The conspirators

then paid about four months of premiums on the fraudulent

policies, from hundreds of different bank accounts opened

for that purpose, before defaulting. According to AIL’s

compensation structure, policies that lapsed before the end

of four months resulted in the agents being “charged back”

for their unearned advances, but policies that lapsed after

four months would result in only a debit of the unearned

value against the agents’ “back-end” accounts. These back-

end accounts served as a retirement account of sorts,

representing the net earnings an agent could anticipate

collecting after leaving the agency, subject to certain

conditions. By keeping the fraudulent policies active for

6 UNITED STATES V. GAGARIN

four months, conspiring agents were able to pocket the

difference between their advanced compensation and the

premiums they paid on the policies. During the course of

this conspiracy, the conspirators submitted about

700 fraudulent applications, although not all applications

resulted in issued policies.

To convince AIL of the legitimacy of the fraudulent

policies, the conspirators forged electronic signatures on the

insurance applications and gave other identifying

information of the purported applicants. The conspirators

also misrepresented information about the applicants on the

insurance applications to increase the likelihood that AIL

would grant a policy. When AIL made phone calls to verify

the applicant’s identity, the conspirators, including Gagarin,

would impersonate the purported applicant from dozens of

cell phones purchased for that purpose. When AIL requested

a medical examination to determine eligibility for insurance,

the conspirators engaged in a variety of tactics to accomplish

the medical examination, including creating fake drivers’

licenses to impersonate applicants during the medical

examinations. Halali also encouraged agents to sign up

friends and family members for fraudulent policies by

offering them the opportunity to get a free medical exam.

When Gagarin was not managing JFA’s San Jose office

in Halali’s absence, her day-to-day responsibilities included

selling policies for AIL and supervising certain agents within

the office. On several occasions, Gagarin submitted

insurance applications that falsely listed these agents as the

“writing agent”—the agent who had executed the policy.

Because the policy would then be registered officially in

those agents’ names, Gagarin would ask them to reimburse

her for the advanced commissions and bonuses they were

paid on those policies.

UNITED STATES V. GAGARIN 7

In September 2011, AIL received an electronic insurance

application from Melissa Gilroy, Gagarin’s cousin.

Although not listed as the writing agent, by all accounts

Gagarin was the agent who executed and submitted the

application. The application contained false information

about Gilroy’s employment status, salary, and the nature of

her relationship with the intended beneficiary. Although the

application contained Gilroy’s electronic signature

indicating that she was the payor of the policy, the bank

account connected to the policy actually belonged to Steven

Nguyen—the brother of an admitted co-conspirator in the

scheme—and was later replaced by a bank account held in

Gagarin’s name. Elsewhere, the application contained

Gilroy’s electronic signature, purportedly certifying that all

information in the application was true and correct to the best

of her knowledge. The requested policy coverage was for

more than $300,000, at a monthly premium of $236.

Pursuant to a grant of immunity, Gilroy testified at trial

that she had asked her cousin Gagarin to “sign [her] up for a

policy” after experiencing a health scare. Gilroy further

testified that she had asked Gagarin to state falsely that

Metro PCS was her place of employment because she

worried she would be denied insurance if AIL knew she was

unemployed. At the same time, Gilroy testified that she had

intended to pay for the policy herself and never asked

Gagarin to pay for it through anyone else’s bank account.

Nor had she asked Gagarin to lie about the nature of her

relationship to the named beneficiary. Gilroy also stated that

she never discussed the type of coverage, the coverage

amount, or the premium amount with Gagarin. Although she

had previously worked for AIL for a few months, she stated

that she was not familiar with AIL’s new electronic

application process and that she had never seen the

8 UNITED STATES V. GAGARIN

application in question, let alone typed or otherwise

electronically signed her name on it.

In December 2014, a grand jury indicted five people—

Benham Halali, Ernesto Magat, Kraig Jilge, Karen Gagarin,

and Alomkone Soundara—on charges of conspiracy to

commit wire fraud under 18 U.S.C. § 1349; wire fraud under

18 U.S.C. § 1343; and aggravated identity theft under

18 U.S.C. § 1028A. Jilge and Soundara pleaded guilty

pursuant to a cooperation agreement, while Halali, Magat,

and Gagarin went to trial. At trial, the jury found Halali,

Magat, and Gagarin guilty of all charges. Gagarin was found

guilty of fourteen counts of wire fraud, including Count 10

in connection with the Gilroy insurance application. The

Gilroy application also was the basis for Gagarin’s Count 24

conviction for aggravated identity theft.

Gagarin filed a post-trial motion for a judgment of

acquittal, pursuant to Rule 29 of the Federal Rules of

Criminal Procedure, contending that insufficient evidence

supported her wire fraud conviction under Count 10 and her

aggravated identity theft conviction under Count 24. The

district court denied the motion on both counts.

At sentencing, the district court concluded that a three-

level sentencing enhancement for having a “manager or

supervisor” role applied to Gagarin on the underlying fraud

counts, pursuant to § 3B1.1(b) of the United States

Sentencing Guidelines. Finding, nonetheless, that Gagarin

was “far less culpable than the other two,” the court

sentenced her to only 12 months of incarceration for the

conspiracy and fraud counts. In addition, the court

sentenced Gagarin to the mandatory minimum 24 months for

the aggravated identity theft conviction, to run consecutively

with the 12-month sentence, for a total of 36 months in

prison.

UNITED STATES V. GAGARIN 9

The district court also held Gagarin jointly and severally

liable with Halali and Magat for restitution to AIL for its

losses, which the court assessed at $2,837,791.93,

representing the total amount of advances AIL had paid out

to the conspirators, less the money AIL had already

recovered.

In this timely appeal, Gagarin challenges the district

court’s denial of her post-trial motion for acquittal on the

aggravated identity theft count, the court’s imposition of the

three-level sentencing enhancement on the fraud claims, and

the court’s order of restitution. We have jurisdiction

pursuant to 28 U.S.C. § 1291.

II

We review de novo a district court’s denial of a Rule 29

motion for a judgment of acquittal. United States v. Grovo,

826 F.3d 1207, 1213 (9th Cir. 2016). Upon a defendant’s

motion, the court “must enter a judgment of acquittal of any

offense for which the evidence is insufficient to sustain a

conviction.” Fed. R. Crim. P. 29(a). In determining whether

evidence was insufficient to sustain a conviction, we

consider whether, “after viewing the evidence in the light

most favorable to the prosecution, any rational trier of fact

could have found the essential elements of the crime beyond

a reasonable doubt.” United States v. Nevils, 598 F.3d 1158,

1163–64 (9th Cir. 2010) (en banc) (quoting Jackson v.

Virginia, 443 U.S. 307, 319 (1979)).

Here, we consider whether, viewing the evidence in the

light most favorable to the prosecution, any rational trier of

fact could have found the essential elements of aggravated

identity theft beyond a reasonable doubt. In relevant part,

“[w]hoever, during and in relation to any felony violation

enumerated in subsection (c),” including wire fraud,

10 UNITED STATES V. GAGARIN

“knowingly transfers, possesses, or uses, without lawful

authority, a means of identification of another person” is

guilty of aggravated identity theft. 18 U.S.C. § 1028A(a)(1).

Gagarin claims that three essential elements were not

satisfied, contending that (1) she did not “use” a means of

identification “during and in relation to” the commission of

wire fraud under the terms of the statute, (2) she did not act

“without lawful authority,” and (3) she did not use the means

of identification of “another person.” We review questions

of statutory interpretation de novo. United States v. Osuna-

Alvarez, 788 F.3d 1183, 1185 (9th Cir. 2015) (per curiam).

The parties dispute, as a threshold matter, whether a rational

trier of fact could have concluded that, contrary to Gilroy’s

testimony, Gilroy never requested Gagarin’s help applying

for insurance. We do not resolve this dispute because,

assuming arguendo that any rational trier of fact would have

determined that Gilroy did make such a request, we conclude

nonetheless that sufficient evidence supports each element

of the offense.

A

After oral arguments in this appeal, another panel of our

court addressed the meaning of “use” under the aggravated

identity theft statute. See United States v. Hong, 938 F.3d

1040, 1049–51 (9th Cir. 2019). Drawing on previous

treatment of this term in the context of § 1028A by the First

and Sixth Circuits, we held in Hong that the owner of several

massage and acupuncture clinics did not “use” a means of

identification when, in order to fraudulently qualify for

Medicare reimbursement, he merely misrepresented the

nature of treatment that actual patients of his received. Id. at

1051. We reasoned that “[n]either Hong nor the physical

therapists [complicit in his scheme] ‘attempt[ed] to pass

themselves off as patients.’” Id. (quoting United States v.

UNITED STATES V. GAGARIN 11

Berroa, 856 F.3d 141, 156 (1st Cir. 2017)). Nor did they

“‘purport[] to take some other action on another person’s

behalf’ through impersonation or forgery.” Id. at 1051 n.8

(quoting United States v. Valdez-Ayala, 900 F.3d 20, 35 (1st

Cir. 2018)). As a result, the defendant did not “use” a means

of identification “during and in relation to” his commission

of health insurance fraud. Id. at 1051. In reaching this

holding, Hong relied on a line of cases from the Sixth Circuit

which that court has summarized as establishing that “[t]he

salient point is whether the defendant used the means of

identification to further or facilitate” the predicate felony for

the aggravated identity theft charge. United States v.

Michael, 882 F.3d 624, 627–28 (6th Cir. 2018)

(summarizing the circuit’s approach). 1

Here, Gagarin purported to take action on behalf of her

cousin Melissa Gilroy, and in so doing used Gilroy’s identity

to further the fraudulent insurance application. As Gilroy

testified, Gilroy never asked Gagarin to sign an insurance

application in her name, nor did the two ever discuss

specifics, such as the type or amount of coverage Gilroy

wanted or the premium she would be willing to pay. Instead,

they discussed in a general sense Gilroy’s desire that

Gagarin help her find an insurance policy, and Gilroy never

saw, let alone signed, the particular application that was

submitted to AIL. Viewing the facts in the light most

favorable to the prosecution, Nevils, 598 F.3d at 1163–64,

the inescapable inference is that Gagarin forged Gilroy’s

signature in two places on that application. The application

1

In Michael, the Sixth Circuit held that the defendant “used” a

means of identification when he “fashion[ed] a fraudulent submission

out of whole cloth.” 882 F.3d at 629. It noted that, if he had merely

“inflated the amount of drugs he dispensed, the means of identification

. . . would not have facilitated the fraud.” Id.

12 UNITED STATES V. GAGARIN

contained falsehoods and constituted the basis of Gagarin’s

Count 10 wire fraud conviction, which is unchallenged on

appeal. At the same time, Gagarin’s forgery of Gilroy’s

signature falsely conveyed the impression that Gilroy herself

certified that “the answers set forth above are full, complete

and true to the best of my knowledge and belief.”

Unlike Hong, in which the defendant submitted

documents about his own eligibility for certain benefits,

938 F.3d at 1049–51, Gagarin “attempt[ed] to pass [herself]

off” as her cousin through forgery and impersonation. Id.

at 1051; see also United States v. Blixt, 548 F.3d 882, 886

(9th Cir. 2008) (holding “that forging another’s signature

constitutes the use of that person’s name and thus qualifies

as a ‘means of identification’ under 18 U.S.C. § 1028A”).

As our sister circuits have recognized, “the use of another

person’s means of identification makes a fraudulent claim

for payment much harder to detect,” United States v.

Medlock, 792 F.3d 700, 707 (6th Cir. 2015) (quoting United

States v. Abdelshafi, 592 F.3d 602, 610 (4th Cir. 2010)), and

Gagarin’s forgery of her cousin’s signature did just that by

obscuring her own role in the fraudulent application. Her

use of Gilroy’s means of identification was thus central to

the fraud and “furthered and facilitated” its commission. For

these reasons, we hold that Gagarin’s actions constituted

“use” under the meaning of the aggravated identity theft

statute.

B

Gagarin also contends that she did not act “without

lawful authority,” a required element of aggravated identity

theft. We disagree. We have held that “despite its title,

§ 1028A does not require theft as an element of the offense.”

Osuna-Alvarez, 788 F.3d at 1185. We have further held that

§ 1028A’s prohibition of the use of another person’s means

UNITED STATES V. GAGARIN 13

of identification “without lawful authority” “clearly and

unambiguously encompasses situations . . . where an

individual grants the defendant permission to possess his or

her means of identification, but the defendant then proceeds

to use the identification unlawfully.” Id.

Gagarin acknowledges that, in light of Osuna-Alvarez,

even if Gilroy consented to the submission of the insurance

application, this would not mean that Gagarin had “lawful

authority.” Gagarin argues that, in order to show that she

acted “without lawful authority,” the Government must

show that her use of the means of identification was “itself

illegal.”

We disagree. Whether a particular use was “itself

illegal” relates to the degree of connection between the use

of the identity and the predicate felony. But the statute

already contains language about the required nexus: the use

must be “during and in relation to” specified unlawful

activity. Here, for the reasons stated above, Gagarin used

Gilroy’s identity during and in relation to the wire fraud that

Gagarin does not challenge occurred here. Gagarin has not

shown that use “without lawful authority” required more in

this case.

C

Next, Gagarin invites us to adopt the Seventh Circuit’s

interpretation of “another person.” The Seventh Circuit has

construed the phrase “another person” in the aggravated

identity theft context to mean “a person who did not consent

to the use of the ‘means of identification.’” United States v.

Spears, 729 F.3d 753, 758 (7th Cir. 2013) (en banc). The

Seventh Circuit found ambiguous the question of whether

“another person” refers to a “person other than the

defendant” or a “person who did not consent to the

14 UNITED STATES V. GAGARIN

information’s use” and therefore resorted to several tools of

statutory interpretation to resolve the perceived ambiguity.

Id. at 756–58. It was concerned that a broad construction of

the phrase “would convert most identity fraud into identity

theft and add a mandatory, consecutive, two-year term to

every conviction,” even as it acknowledged that § 1028A’s

abbreviated list of predicate offenses “is one reason why

§ 1028A carries a harsher sentence” than the identity fraud

statute. Id. at 757. The Seventh Circuit further cited to the

statutory caption—Aggravated Identity Theft—and the Rule

of Lenity to support its conclusion that “another person”

applies only to a person who did not consent to the

information’s use. Id. at 756–58.

Gagarin argues that because Gilroy requested that

Gagarin file an insurance application for her, under Spears

the “another person” element of aggravated identity theft is

not satisfied here. 2 But following Spears to so hold would

conflict with our precedent in Osuna-Alvarez. Interpreting

“another person” to mean “a person who did not consent to

the use of the means of identification” contradicts our

holding that, “regardless of whether the means of

identification was stolen or obtained with the knowledge and

2

In United States v. Maciel-Alcala, we considered another aspect of

the term “another person”—specifically, whether “another person”

“encompass[es] both living and deceased persons.” 612 F.3d 1092,

1100–01 (9th Cir. 2010). We concluded that it applies to either “so long

as the person is an actual person.” Id. at 1101 (citing Flores-Figueroa v.

United States, 556 U.S. 646, 654 (2009), which referred to “another

person” as a “real person” in determining the scope of § 1028A’s

“knowledge” requirement); see also United States v. Doe, 842 F.3d

1117, 1119–20 (9th Cir. 2016) (“To prove a violation of § 1028A, the

Government must prove . . . [t]he defendant knew the means of

identification belonged to a real person . . . .”). Gagarin does not dispute

that Gilroy is covered by this aspect of what it means to be “another

person.”

UNITED STATES V. GAGARIN 15

consent of its owner, the illegal use of the means of

identification alone violates § 1028A.” Osuna-Alvarez,

788 F.3d at 1185–86. Under the Seventh Circuit’s

construction, that case would have been wrongly decided,

because it affirmed the defendant’s conviction despite the

fact that the defendant had permission to use his brother’s

passport. See id. 3

Nor are we convinced by the interpretive analysis of

Spears on its own terms. The phrase “another person” does

not appear particularly ambiguous on its face, especially

when we have already determined the phrase refers to

another “actual person.” Maciel-Alcala, 612 F.3d at 1101.

The plain reading of “another person” seems to us to be an

actual “person other than the defendant.” Contra Spears,

729 F.3d at 756 (rejecting this reading). Since “[a] statute’s

caption . . . cannot undo or limit its text’s plain meaning,”

Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241,

242 (2004), § 1028A’s caption of “Aggravated Identity

Theft” does not alter the plain meaning of “another person.”

Recourse to the Rule of Lenity is not necessary because

“another person” is unambiguous.

In summary, even if Gagarin had Gilroy’s consent, we

follow our circuit precedent to hold that Gagarin used the

3

In Osuna-Alvarez, we cited the panel opinion in Spears, which was

vacated by the Seventh Circuit’s en banc decision, as consistent with our

holding regarding “without lawful authority.” See 788 F.3d at 1185. We

did not, however, indicate that the Spears en banc opinion was consistent

with our holding. Today we recognize that it would not be workable to

adopt both the Spears en banc interpretation of “another person” and the

Osuna-Alvarez interpretation of “without lawful authority.” That the

cases interpreted different words in the statute cannot obscure that

Spears made available a consent defense that Osuna-Alvarez squarely

rejected.

16 UNITED STATES V. GAGARIN

means of identification of “another person” by using the

identification of another “actual person.”

III

Gagarin challenges the district court’s application of a

three-level “manager or supervisor” role sentencing

enhancement, pursuant to § 3B1.1(b) of the United States

Sentencing Guidelines. “A mistake in calculating the

recommended Guidelines sentencing range is a significant

procedural error that requires us to remand for

resentencing.” United States v. Munoz-Camarena, 631 F.3d

1028, 1030 (9th Cir. 2011). “[A]s a general rule, a district

court’s application of the Sentencing Guidelines to the facts

of a given case should be reviewed for abuse of discretion.”

United States v. Gasca-Ruiz, 852 F.3d 1167, 1170 (9th Cir.

2017) (en banc), cert. denied, 138 S. Ct. 229 (2017).

Although “[i]t is not necessary that the district court make

specific findings of fact to justify the imposition of the role

enhancement,” there must be evidence in the record to

support the enhancement. United States v. Holden, 908 F.3d

395, 401 (9th Cir. 2018) (quoting United States v. Whitney,

673 F.3d 965, 975 (9th Cir. 2012)), cert. denied, 139 S. Ct.

1645 (2019).

To qualify for a three-level sentencing enhancement

under § 3B1.1(b), a defendant must have managed or

supervised one or more other “participants” in an extensive

criminal activity. 4 United States v. Gadson, 763 F.3d 1189,

1222 (9th Cir. 2014). A participant is a person “who [is]

criminally responsible for the commission of the offense, but

4

Gagarin does not dispute that the conspiracy to defraud AIL

involved five or more participants or was otherwise extensive, as

required for § 3B1.1 to apply.

UNITED STATES V. GAGARIN 17

[who] need not have been convicted.” Id. (internal quotation

marks and citation omitted). In determining by a

preponderance of the evidence whether the enhancement

applies, the district court considers factors such as:

the exercise of decision making authority, the

nature of participation in the commission of

the offense, the recruitment of accomplices,

the claimed right to a larger share of the fruits

of the crime, the degree of participation in

planning or organizing the offense, the nature

and scope of the illegal activity, and the

degree of control and authority exercised

over others.

U.S.S.G. § 3B1.1 cmt. n.4; Gadson, 763 F.3d at 1222. In

particular, “there must be evidence that the defendant

exercised some control over others involved in commission

of the offense [or was] responsible for organizing others for

the purpose of carrying out the crime.” Gadson, 763 F.3d at

1222 (quoting United States v. Riley, 335 F.3d 919, 929 (9th

Cir. 2003)). The role enhancement cannot apply if the

defendant and the other participant are merely “co-equal

conspirators.” Holden, 908 F.3d at 402.

The district court did not abuse its discretion because

“evidence in the record supports an inference that [Gagarin]

exercised the requisite degree of control” over at least one

criminally responsible participant, Reza Zabihi. Gadson,

763 F.3d at 1222. There is no dispute that Zabihi, who joined

the San Jose office of JFA as an intern a few months before

the initiation of the conspiracy, was a criminally responsible

participant in the fraudulent scheme. At the time of the

offenses, Zabihi served as a sales agent of AIL policies and

as an unofficial personal assistant to Halali, even as Zabihi

18 UNITED STATES V. GAGARIN

held the “joke” title of HR manager. On many occasions,

Zabihi complied with Halali’s instructions to “Go get me

two free accounts,” which Zabihi knew meant unused bank

accounts that could be used to pay fraudulent policies.

Although Zabihi principally answered to Halali, Gagarin

ran the San Jose office when Halali was absent and was thus

in charge of Zabihi during those times. That both Gagarin

and Zabihi took instructions from Halali does not mean that

they were “co-equal conspirators.” See U.S.S.G. § 3B1.1

cmt. n.4 (“There can, of course, be more than one person

who qualifies as a leader or organizer of a criminal

association or conspiracy.”); see also Holden, 908 F.3d

at 402–03 (overturning the imposition of a sentencing

enhancement where the district court expressly determined

that the only two conspirators were “co-equal” but

nonetheless impermissibly imposed a role enhancement). In

addition to running the office in Halali’s place, Gagarin also

guided Zabihi through actions to further the conspiracy. On

at least one occasion, she instructed Zabihi to “give [her] two

bank accounts” for use in paying premiums on fraudulent

policies. Zabihi also testified that he gave Gagarin Google

Voice phone numbers for her to use on applications as the

numbers for fake insurance applications. Cross-examination

of Zabihi, which showed that he had neglected to inform

investigators of Gagarin’s role in the conspiracy on multiple

occasions, also may have created a reasonable inference that

Zabihi’s testimony was less than forthcoming about the

extent of Gagarin’s involvement. On these bases, enough

evidence in the record existed for the district court to infer,

by a preponderance of the evidence, that Gagarin exercised

control over Zabihi, a criminally responsible participant in

the conspiracy. Gadson, 763 F.3d at 1222. We hold that the

district court did not abuse its discretion and commit

UNITED STATES V. GAGARIN 19

significant procedural error by imposing a three-level

“manager or supervisor” enhancement.

IV

The legality of a restitution order is reviewed de novo,

United States v. Galan, 804 F.3d 1287, 1289 (9th Cir. 2015),

as is the district court’s “valuation methodology,” United

States v. Berger, 473 F.3d 1080, 1104 (9th Cir. 2007). If

“the order is within statutory bounds,” then the restitution

calculation is reviewed for abuse of discretion, with any

underlying factual findings reviewed for clear error. Galan,

804 F.3d at 1289. We also review a district court’s decision

to impose joint and several liability for abuse of discretion.

United States v. Booth, 309 F.3d 566, 576 (9th Cir. 2002).

A

Under the Mandatory Victims Restitution Act (MVRA),

which applies “in all sentencing proceedings for convictions

of . . . an offense against property under this title . . .

including any offense committed by fraud or deceit,”

18 U.S.C. § 3663A(c)(1)(A)(ii), a court must order

restitution to each victim in the full amount of the victim’s

losses, 18 U.S.C. § 3664(f)(1)(A). Because “[t]he purpose

of restitution is to put the victim back in the position he or

she would have been but for the defendant’s criminal

conduct,” United States v. Gossi, 608 F.3d 574, 581 (9th Cir.

2010), the “amount of restitution is limited to the victim’s

‘actual losses’ that are a direct and proximate result of the

defendant’s offense,” United States v. Thomsen, 830 F.3d

1049, 1065 (9th Cir. 2016) (quoting United States v. Eyraud,

809 F.3d 462, 467 (9th Cir. 2015)). Actual loss represents

the difference between “(1) the loss [the victim] incurred

because of the unlawful conduct, [and] (2) the loss the

[victim] would have incurred had [defendant] acted

20 UNITED STATES V. GAGARIN

lawfully.” United States v. Bussell, 504 F.3d 956, 965 (9th

Cir. 2007).

A district court is to resolve disputes as to the proper

amount of restitution by a preponderance of the evidence.

18 U.S.C. § 3664(e). Although the Government bears the

initial burden of proving the loss amount, “[t]he question of

who bears the burden for establishing a right to statutory

offset is . . . left to the court’s determination of what ‘justice

requires.’” United States v. Crawford, 169 F.3d 590, 593 n.2

(9th Cir. 1999); see 18 U.S.C. § 3664(e) (for matters other

than proving the loss amount or the defendant’s financial

resources, the burden “shall be upon the party designated by

the court as justice requires”). For that reason, we have

upheld a restitution order where “it appears that the district

court placed this burden on the defendant.” Crawford,

169 F.3d at 593 n.2; accord United States v. Serawop,

505 F.3d 1112, 1127 (10th Cir. 2007).

Gagarin asserts that the district court employed an

unlawful valuation methodology or at least abused its

discretion by choosing not to deduct the value of

Defendants’ “back-end” accounts from the restitution award.

As described earlier, these accounts contained the ongoing

earnings from commissions not yet paid through advances,

minus the value of any advances that exceeded the agents’

actual earnings, e.g., because the policyholder stopped

paying premiums before the end of the period for which the

advance was made. Agents were permitted to collect from

these back-end accounts upon leaving the company, so long

as they were not fired for cause, their interest had vested, and

payments continued to be made on the policies that the

agents had sold. Gagarin contends that these back-end

accounts were real, vested assets, to which Defendants

would have been entitled had they acted lawfully, and

UNITED STATES V. GAGARIN 21

therefore that the value of the accounts should be deducted

from the restitution amount in accordance with Bussell,

504 F.3d at 965.

There is no indication, however, that the district court

employed an erroneous valuation methodology that focused

on a criterion other than the actual losses of the victim.

Rather, the court chose not to deduct the value of the back-

end accounts because of its conclusion that the accounts

were only “estimates which do not affect the calculation of

the loss here,” relying in part on the conclusions of the

Presentence Report. Since the district court applied the

proper standard, we review its determination of the amount

of loss for only clear error. Galan, 804 F.3d at 1289.

Because “it appears that the district court placed [the]

burden [of establishing the right to a deduction] on the

defendant,” Crawford, 169 F.3d at 593 n.2, Defendants had

to prove by a preponderance of the evidence that they would

have been entitled to the value of the back-end accounts had

they acted lawfully. See Bussell, 504 F.3d at 965. Although

Defendants’ counsel elicited an isolated acknowledgment

that an agent could be paid the value of the back-end

accounts upon termination if “customers continue to pay

premiums” and “if the agent was vested,” the weight of the

evidence characterized the back-end accounts not as actual,

vested entitlements, but rather as projections of the present

value of future commissions, “if all necessary criteria were

met.” Defendants did not show that all necessary criteria

were met. For example, it is far from clear that, had

Defendants not committed the crimes that caused them to be

fired for cause, they would have eventually left AIL in good

standing and would have met the necessary criteria to be paid

from the back-end accounts. See Serawop, 505 F.3d at 1127

(holding that a defendant could not prove entitlement to a

22 UNITED STATES V. GAGARIN

deduction based on speculative assumptions). The district

court did not commit clear error by finding that Defendants

had not met their burden and that the back-end accounts were

“estimates which do not affect the calculation of the loss

here.” As a result, we hold that the district court did not

abuse its discretion by declining to deduct the purported

value of the back-end accounts from the restitution award.

B

Gagarin’s remaining claims lack merit. The MVRA

expressly permits the imposition of joint and several

liability, 18 U.S.C. § 3664(h) (“the court may make each

defendant liable for payment of the full amount of

restitution”), and Gagarin cites no authority that reversed as

abuse of discretion a district court’s imposition of joint and

several liability in this context. Since the “court knew it had

[the] option” to apportion the restitution award among the

Defendants, “but decided not to exercise it,” we decline to

second-guess the court’s decision. Booth, 309 F.3d at 576.

Gagarin’s contention that the restitution schedule is

internally inconsistent is also unavailing. Gagarin relies on

United States v. Holden, in which we vacated and remanded

a restitution order because the restitution schedule’s

requirement of both a “[l]ump sum payment” due

immediately and a schedule of small payments to be made

during the defendant’s period of incarceration was internally

inconsistent. 908 F.3d at 403. But in Holden, the imposition

of installment payments during incarceration was not

contingent, by the schedule’s terms, on non-payment of the

lump sum. The restitution schedule in this case, in contrast,

is implicitly conditional: It specifies that a lump sum

payment is “due immediately,” but that the “balance”—i.e.,

any portion of that single restitution amount that is not in fact

paid “immediately”—is “due . . . in accordance with” an

UNITED STATES V. GAGARIN 23

installment plan. Gagarin contends that the restitution

schedule in Holden used the same “balance due” conditional

language as the district court used here with respect to the

defendant’s post-incarceration payment schedule. But

Holden vacated the restitution schedule on account of the

“unconditional schedule of payments during the period of

incarceration.” Id. at 404 (emphasis added). And unlike in

Holden, where the district court expressly found that the

defendant lacked ability to pay according to the schedule, id.,

here there has been no such finding. We conclude that there

was no error in the district court’s restitution order.

V

For the foregoing reasons, we affirm the aggravated

identity theft conviction, the sentencing enhancement, and

the restitution order.

AFFIRMED.

FRIEDLAND, Circuit Judge, concurring except as to the

penultimate paragraph of Part II.C:

I concur in Judge Gould’s thoughtful opinion as to all

issues but one: I am disinclined to criticize “on its own

terms” the analysis of the unanimous en banc Seventh

Circuit in United States v. Spears, 729 F.3d 753 (7th Cir.

2013).

I agree that Spears’s holding is irreconcilable with this

court’s holding in United States v. Osuna-Alvarez, 788 F.3d

1183 (9th Cir. 2015). I also agree that, under a faithful

application of our court’s precedent, Gagarin’s conviction

must be affirmed. In my view, however, Spears adopts a

24 UNITED STATES V. GAGARIN

reasonable limiting interpretation of a statute that could

otherwise be stretched to cover situations far afield from

what its title says it is about: aggravated identity theft, not

mere identity fraud.

Spears explains that there is a risk, in reading the

ambiguous text of 18 U.S.C. § 1028A too broadly, of

sweeping in conduct involving a “means of identification”

that is hardly stolen from a victim; the identity might, under

some interpretations of the statute, belong even to a willing

participant in the predicate offense. See Spears, 729 F.3d

at 756 (describing an interpretation of the statute that would

cover “every time a tax-return preparer claims an improper

deduction”). By holding that the term “another person”

describes only “a person who did not consent to the use of

the ‘means of identification,’” Spears provides one way to

make sure courts do not “convert most identity fraud into

identity theft and add a mandatory, consecutive, two-year

term to every conviction, even though [the identity fraud

statute] lacks any equivalent sentencing provision.” See id.

at 757–58 (emphases added). Indeed, although our holding

in Osuna-Alvarez is irreconcilable with Spears’s holding,

our later caselaw has, relying on language in § 1028A that

was not analyzed in either of those cases, incorporated

limitations that flow from the same concerns that animated

the Seventh Circuit’s decision in Spears. See United States

v. Hong, 938 F.3d 1040, 1051 (9th Cir. 2019) (rejecting a

broad interpretation of the term “use” based on the First

Circuit’s analysis in United States v. Berroa, 856 F.3d 141

(1st Cir. 2017), which in turn relied on Spears).

If this appeal had arisen on a blank slate, I would have

given serious consideration to adopting Spears’s holding.

And for the reasons expressed in Spears, I believe there may

be a need in future cases to adopt interpretations of the

UNITED STATES V. GAGARIN 25

identity theft statute that help prevent it from being read to

impose harsh sentences for offenses that do not actually

involve identity theft. I therefore refrain from criticizing our

sister circuit’s sensible attempt to interpret this puzzling

statute.