Restitution

Georgetown Law Journal, Jun 1998 by Kim, Nam E

In the Victims and Witnesses Protection Act of 1982 ("the VWPA"),2344 Congress indicated that courts should routinely impose restitution as part of any sentence.2345 In determining the amount of restitution to impose,2346 the court must consider the loss sustained by the victim, the defendant's financial resources, and the financial needs and earning ability of the defendant and her dependents.2347 Courts may not order restitution to a victim who has already received or is to receive compensation for her loss;2348 however, courts may order restitution to any third party who has compensated a victim for her loss.2349

In Hughey v. United States,2350 the Supreme Court held that restitution may be awarded only for the victim's losses2351 resulting from the specific conduct for which the defendant was convicted.2352 Subsequently, Congress enacted the Crime Control Act of 1990 ("the Act")2353 which limits Hughey in two respects. First, the Act authorizes courts to order any restitution amount agreed to by the parties in a plea agreement even if that amount is greater than the amount charged in the indictment.2354 Second, when a defendant is convicted of an offense involving a scheme, conspiracy, or pattern of criminal activity, the Act authorizes restitution to any person directly harmed by the defendant's conduct in the course of the scheme, conspiracy, or pattern.2355

Congress recently enacted the Mandatory Victims Restitution Act of 1996 ("the MVRA").2356 The MVRA further expands the group of victims eligible for restitution to include those "proximately harmed" by a scheme or conspiracy.2357 It also makes restitution mandatory for certain crimes,2358 outlines a procedure for restitution when there is public harm without an identifiable victim,2359 and makes restitution a mandatory condition of probation.236 The MVRA does not apply to convictions preceding the date of enactment, April 24, 1996.2361

Nam E. Kim

2344. 18 U.S.C. 3663-3664 (1994).

2345. S. REP. No. 532, 97th Cong., 2d Sess. 30 (1982), reprinted in 1982 U.S.C.C.A.N. 2515, 2536. Restitution may be ordered for offenses under Title 18; section 401, 408(a), 409, 416, or 422(a) of the Controlled Substances Act (21 U.S.C. 841, 848(a), 849, 856, 861, or 863); or section 46312, 46502, or 46504 of Title 49. 18 U.S.C. 3663(a)(1) (1994); 18 U.S.C.A. 3663(a)(1)(A) (West Supp. July 1996); see U.S. v. Stout, 32 F.3d 901, 905 (5th Cir. 1994) (restitution order improper for tax offense under Title 26). Restitution may be ordered in addition to any other punishment. 18 U.S.C. 3663(a)(1) (1994); see U.S. v. Miguel, 49 F.3d 505, 510 (9th Cir. 1995) (for misdemeanors, statute authorizes restitution in addition to other punishment).

Restitution is one of three alternate mandatory conditions of probation for felony offenses, and payment of any ordered restitution is a condition of probation. 18 U.S.C. 3563(a), (b)(3), 3663(g) (1994). The Mandatory Victims Restitution Act of 1996, however, makes restitution a mandatory condition of probation for all offenses. Pub. L. No. 104-132, Title II, 203, 110 Stat. 1214, 1227 (1996). The Act applies to convictions occurring on or after April 24, 1996. Id. 211, 110 Stat. at 1241. Nonetheless, revocation of probation or supervisory release does not automatically relieve a defendant of an order to pay restitution. See U.S. v. Webb, 30 F.3d 687, 690 (6th Cir. 1994) (court's decision to revoke supervised release did not invalidate original restitution order).

2346. The court itself must determine the amount of restitution owed and any appropriate payment schedule. See U.S. v. Mortimer, 94 F.3d 89, 89-91 (2d Cir. 1996) (restitution invalid when determination of payment schedule delegated to Bureau of Prisons); U.S. v. Arnold, 106 F.3d 37, 44 (3d Cir. 1997) (restitution invalid when determination of amount and payment schedule delegated to probation officer); U.S. v. Blake, 81 F.3d 498, 507 (4th Cir. 1996) (restitution invalid when determination of amount and schedule of restitution installment payments delegated to Bureau of Prisons or U.S. Probation Office); U.S. v. Albro, 32 F.3d 173, 174 (Sth Cir. 1994) (per curiam) (restitution invalid when payment schedule determined by probation officer); U.S. v. Yahne, 64 F.3d 1091, 1097 (7th Cir. 1995) (same); U.S. v.

Barany, 884 F.2d 1255, 1261 (9th Cir. 1989) (restitution invalid when determination made solely by probation officer).

2347. 18 U.S.C. 3663(a) (1994). The burden of demonstrating the amount of the loss sustained by a victim is placed on the government. Id. 3664(d). The defendant bears the burden of establishing her inability to pay. Id.

It is unclear how explicitly the court must consider the statutory factors and how much relative weight must be given to a defendant's apparent inability to pay. Compare U.S. v. Thompson, 113 F.3d 13, 16 (2d Cir. 1997) (restitution improper when no indication in record that the judge's statement regarding the defendant's financial situation related to judge's determination of restitution); U.S. v. Gaydos, 108 F.3d SOS, 511 (3d Cir. 1997) (restitution improper when court failed to make specific findings of fact regarding defendant's ability to pay); U.S. v. Blake, 81 F.3d 498, SOS (4th Cir. 1996) (restitution improper when record contained no articulation of defendant's earning ability, financial needs, or ability to make necessary restitution payments); U.S. v. Dupre, 117 F.3d 810, 824 (Sth Cir. 1997) (restitution improper when court proceeded with restitution order despite allegations that defendant had improperly concealed assets from the court), cert. denied, 118 S. Ct. 857 (1998); U.S. v. Sanders, 95 F.3d 449, 455-56 (6th Cir. 1996) (restitution order improper when court failed to consider statutory factors including ability to pay); U.S. v. Jaroszenko, 92 F.3d 486, 492 (7th Cir. 1996) (restitution improper when court imposed restitution of $224,000 on defendant without considering her ability to pay); U.S. v. Van Brocklin, I IS F.3d 587, 602 (8th Cir. 1997) (restitution improper when court failed to show its consideration of statutory factors including ability to pay); U.S. v. Haddock, SO F.3d 835, 838 (lOth Cir. 1995) (restitution improper when court imposed restitution of $76,732 on defendant without considering his ability to pay) and U.S. v. Fuentes, 107 F.3d 1515, 1527-28, 1534 (llth Cir. 1997) (restitution improper when court imposed restitution of $357,281 which defendant could not pay because defendent was indigent and lacked job skills necessary to pay over time) with U.S. v. Vaknin, 112 F.3d 579, 592 (lst Cir. 1997) (restitution proper when sentencing judge was unsure about defendant's current ability to pay but found evidence of the potential of future ability to pay); U.S. v. Porter, 90 F.3d 64, 67-68 (2d Cir. 1996) (restitution proper when record does not indicate defendant's ability to pay restitution judgment of $169,043.21, but does indicate defendant's ability to meet payment schedule of $25 per month); U.S. v. Voigt, 89 F.3d 1050, 1091-93 (3d Cir.) (restitution proper when record does not indicate defendant's ability to pay restitution of $7,040,000, but does indicate that defendant secreted assets acquired with misappropriated funds), cert. denied, 117 S. Ct. 623 (1996); U.S. v. Castner, SO F.3d 1267, 1278 (4th Cir. 1995) (restitution proper when defendant had negative net worth at time of sentencing, but court adopted factual findings of Presentencing Report which described defendant's excellent job history, earning record, and high skill level in computer field); U.S. v. Blocker, 104 F.3d 720, 737 (Sth Cir. 1997) (restitution proper when record indicates court considered defendant's financial situation, found defendant was unable to pay both restitution and fine, and only ordered restitution); U.S. v. Hall, 71 F.3d 569, 573-74 (6th Cir. 1995) (restitution proper when record included Presentencing Report and other documents containing information related to defendant's financial position and earning ability); U.S. v. Zaragoza-Barajas, 123 F.3d 472, 479 (7th Cir.) (restitution proper where court found defendants did not have current ability to pay but considered possibility that defendants retained money from fraud because the government could not find much of the proceeds), cert. denied, 118 S. Ct. 317 (1997); U.S. v. French, 46 F.3d 710, 716 (8th Cir. 1995) (restitution proper when victim's loss $331,000 and court, considering financial status of defendant, ordered $50,000 restitution); U.S. v. Nash, IIS F.3d 1431, 1441-42 (9th Cir. 1997) (restitution proper where defendant failed to complete the financial statement in Presentencing Report and therefore failed to show inability to pay, cert. denied, 118 S. Ct. 1054 (1998); U.S. v. Olson, 104 F.3d 1234, 1238 (lOth Cir. 1997) (restitution proper when defendant ordered to pay $6,097,155 because record showed consideration of defendant's use of offshore accounts and of $5,600,000 which had not been recovered); and U.S. v. Davis, 117 F.3d 459, 463-64 (llth Cir.) (restitution proper when record indicates consideration of defendants' financial resources and future earning capabilities in Presentencing Report and of defendants' objections to Presentencing Report), cert. denied, 118 S. Ct. 355 (1997).