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An individual becomes a guidelines “victim” of an unlawful transfer of identification information when the information is used

The issue here is whether the unauthorized transfer of an individual’s identifying information to another party involves the actual use of that information for a fraudulent purpose such that the individual whose identifying information was transferred is as victim under U.S.S.G 2B1.1(b)(2)(B). This sentencing guideline provides for a 4 level enhancement if the offense involved at least 50 but less than 250 victims. The defendant in U.S. v. Hall pleaded guilty to bank fraud conspiracy, identity theft and access device fraud and wrongfully obtaining and transferring individually identifiable health information for personal gain. The district court applied a four level enhancement because the offense involved more than 50 but less than 250 victims. Hall challenged the enhancement arguing that the unlawful transfer or sale of identifying information does not equate to the actual use of identifying information for a fraudulent purpose. The conspirators actually used 12 of the 141 individuals to obtain fraudulent credit cards the so Hall claimed there were less than 50 victims and the 11th Circuit agreed.

Hall worked as an office assistant in a Coral Springs doctor’s office where she had access to patients’ dates of birth, social security numbers and other protected information. She received $200 for each individual’s information she provided to the coconspirators. She received only $200 though sent the codefendants 65 to 141. Her conspirators used 12 of the patients’ personal information to obtain fraudulent credit cards. The government’s position was that all 141 patients whose information was transferred were victims.

The 11th Circuit found that while the 12 individuals were victims, the remaining individuals whose information was merely transferred were not victims under the Application notes which define victims as “any person who sustained any part of an actual loss…who sustained bodily injury as a result of the offense.” Under this enhancement, whether an individual was a victim depends on whether their identification was used. The conspiracy’s purpose was to obtain cash advances and purchase using fraudulent credit cards. Hall’s mere transfer of the personal identifying information, without more action, did not involve using the information to procure fraudulent credit cards and cash and the personal information was not used until the coconspirators secured the credit cards.

The 11th Circuit noted that another specific offense characteristic under §2B1.1 provides for a two level enhancement for the defendant because the offense involved “the unauthorized transfer or use of any means of the identification unlawfully to produce or obtain any other means of identification.” The district court applied this enhancement. The 11th Circuit found that the Commission’s use the terms “use” and “transfer” in the guidelines means it intended for each term to have a particular, non-superfluous meaning. The court reasoned that the Sentencing Commission would not have used the two distinct words if they intended “use” to cover “transfer.” The court would not broaden the meaning of use. The guideline and the application notes indicate that the mere transfer of unauthorized identifying information is not the equivalent to the actual use of the identifying information for a fraudulent purpose.

In case you missed, please read my previous post:
Defendent sentenced even after indictment was withdrawn, January 10, 2013

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