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United States v. Hammerschmidt

United States Court of Appeals, Eighth Circuit

February 2, 2018

United States of America Plaintiff- Appellee
v.
Mark Arlin Hammerschmidt Defendant-Appellant United States of America Plaintiff- Appellee
v.
Ornella Angelina Hammerschmidt Defendant-Appellant

          Submitted: October 20, 2017

         Appeals from United States District Court for the District of Minnesota - St. Paul

          Before WOLLMAN and SHEPHERD, and GOLDBERG, [1] Circuit Judges.

          WOLLMAN, CIRCUIT JUDGE.

         Mark Arlin Hammerschmidt (Mark) pleaded guilty to two counts of conspiracy to defraud the United States in violation of 18 U.S.C. § 286 and was sentenced to 135 months' imprisonment. Ornella Angelina Hammerschmidt (Ornella) pleaded guilty to one count of making false claims for refunds in violation of 18 U.S.C. § 287 and was sentenced to 48 months' imprisonment. The Hammerschmidts appeal from their sentences. Mark argues that the district court erred in calculating his offense level and his criminal history points. Ornella argues that the district court erred in calculating her offense level and in imposing a sentence above the range set forth in the United States Sentencing Guidelines Manual (Guidelines or U.S.S.G.). Because the district court did not make the findings required to increase Mark's offense level for being a manager or supervisor and because it should not have assessed criminal history points for a 2008 purged disposition of civil contempt, we vacate Mark's sentence and remand for resentencing. We affirm Ornella's sentence.

         I. Background

         This case involves two schemes to obtain fraudulent tax refunds from the United States Department of the Treasury through the Internal Revenue Service (IRS). The first scheme involved the Hammerschmidts' providing accounting and tax preparation services through their businesses, American Group and Liberty Tax. They also offered immigration services, with Ornella Hammerschmidt falsely claiming that she was an attorney.

         From January 2011 through February 2013, the Hammerschmidts completed income tax returns for taxpayers in Florida and Minnesota, many of whom were immigrants who did not speak English. The Hammerschmidts reported false information on the returns to qualify the taxpayers for additional refunds. The false information included incorrect filing statuses, false household-help income, fictitious businesses and business losses, and fraudulent tax credits. The taxpayers were not aware that the Hammerschmidts were making false statements on their returns. Ornella sometimes signed the returns on behalf of the taxpayers, and American Group did not always provide clients with copies of their returns. The Hammerschmidts did not identify themselves on the returns as paid tax preparers.

         Most of the refunds were deposited directly into a bank account managed by the Hammerschmidts, who thereafter deducted fees and remitted partial refunds to the taxpayers. All told, the first scheme involved twenty-two federal tax returns that claimed more than $95, 000 in fraudulent refunds, on which the IRS paid out more than $45, 000. The first scheme also involved Minnesota tax returns that claimed $110, 000 in fraudulent refunds, on which the Minnesota Department of Revenue suffered no identifiable actual loss.

         In the second scheme, Mark conspired with others to file false federal income tax returns on behalf of Guatemalan citizens (the Guatemalan conspiracy). From 2010 until February 2012, co-conspirators provided Mark with identifying information of Guatemalan citizens, which he used to obtain individual taxpayer identification numbers. Mark then filed fraudulent federal income tax returns for multiple tax years in the names of the Guatemalan citizens, none of whom resided or worked in the United States. The refunds were sent to addresses or deposited in bank accounts associated with Mark. Mark filed more than five hundred of these fraudulent federal tax returns, claiming approximately $1.8 million in fraudulent refunds, on which the IRS paid out $1, 787, 621.

         A federal grand jury returned a thirty-seven count indictment. Counts 1 through 23 charged Mark and Ornella with offenses related to the first scheme. Counts 24 through 37 charged only Mark and related to the second scheme.

         Mark pleaded guilty to the two counts of conspiracy to defraud the United States (counts 1 and 24), and Ornella pleaded guilty to one count of making a false claim for refunds (count 18). While released on bond pending sentencing, the Hammerschmidts violated a condition of their release by participating in the preparation of tax returns. Ornella helped another tax preparer complete a fraudulent tax return for an undercover agent, who posed as a tax client. The district court placed Mark on location monitoring with home confinement and revoked Ornella's release, concluding that Ornella's "egregious violation of her conditions of release and her involvement in advising the undercover agent to file a fraudulent tax return support a determination that her release must be revoked." D. Ct. Order of Apr. 19, 2016.

         The district court determined that Mark's total offense level was 31, that his criminal history category was III, and that his advisory sentencing range was 135 to 168 months' imprisonment. To impose a sentence of 135 months' imprisonment, the district court sentenced Mark to the statutory maximum term of imprisonment of 120 months on each count, see 18 U.S.C. § 286, with 105 months on count 24 to be served concurrently with count 1 and the remaining 15 months to be served consecutively.

         The district court determined that Ornella's total offense level was 16, that her criminal history category was II, and that her advisory sentencing range was 24 to 30 months' imprisonment. The district court varied upward ...


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