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Souels v. United States

United States District Court, D. New Jersey

August 25, 2017

SEAN A. SOUELS, Petitioner,
v.
UNITED STATES OF AMERICA, Respondent. Cr. No. 10-510-05 (JBS)

          MEMORANDUM OPINION

          JEROME B. SIMANDLE, UNITED STATES DISTRICT JUDGE

         I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY

         Petitioner Sean Souels entered a plea of guilty on September 4, 2014, to conspiracy to commit wire fraud contrary to 18 U.S.C. § 1343, in violation of 18 U.S.C. § 1349. United States v. Souels, Cr. No. 10-510-05 (JBS). Souels admitted he conspired with others as part of a mortgage fraud scheme involving properties in the Wildwood, New Jersey area. Upon his violation of conditions of release, his bail was revoked on March 24, 2015, and he has been in custody since March 27, 2015. [Docket Item 259.]

         He was sentenced on May 14, 2015, to 46 months' imprisonment following a hearing in which the Court determined his Total Offense Conduct (TOC) level was 23 and his Criminal History Category (CHC) was III, yielding an advisory Sentencing Guidelines range of 46 to 57 months.

         In this timely petition under 28 U.S.C. § 2255, Mr. Souels principally asserts that his sentencing level was erroneous due to a loss calculation that incorrectly determined the amount of loss under U.S.S.G. § 2B1.1(b)(1).

         His amended petition, filed November 2, 2015 [Docket Item 3], seeks to set aside his sentence pursuant to § 2255 based on three grounds, which may be paraphrased as follows:

1. The sentence violates the Mandatory Victim Restitution Act of 1996 by using a short sale price rather than a fair market value to determine the amount of the victim's loss.
2. The sentence is illegal because the PSR incorrectly implied the property was foreclosed when the victim financial institution actually sold it at a short sale that canceled the original loans, rendering the loss zero.
3. Defense counsel provided ineffective assistance in acquiescing to the loss amount of $253, 256.23 when in fact there was no loss to the victim.

         In pleading guilty to wire fraud conspiracy, without a written plea agreement, on the eve of trial, Souels admitted, among other things, that he conspired in 2007 with Darryl Henry and Jerry Smith to devise a scheme and artifice to defraud a mortgage lender to grant purchase money mortgage loans to a straw purchaser through means of a false mortgage application and HUD-1 settlement statement in connection with the sham purchase of Unit 203 at 401 East Stockton Road, Wildwood, New Jersey. (Tr. Sept. 4, 2014 at 23-37.)

         In his detailed factual colloquy, Souels testified that he was guilty as charged in Count One of the Second Superseding Indictment. (Id. at 23:18-24.) He admitted he was the pastor of the ReBirth International Church in Union County, New Jersey in 2007, and that he recruited a young naive female member of his congregation, K.P., to be the nominal purchaser of this property at the New Jersey shore under a scheme devised by co-conspirator Jerry Smith, who was involved in the real estate business. (Id. at 23:25-25:4.) Souels provided false information to a mortgage broker that K.P. was employed by his church as “president of operations, ” when in fact K.P. was not a church employee. (Id. at 25:3-10; 26:11-24.) Souels admitted he knew K.P. could not afford a mortgage for $413, 000, or even for a lesser amount such as $299, 000. (Id. at 27:5-19.)

         Souels admitted that he was aware K.P. brought no money to the closing, and he does not dispute that the HUD-1 settlement statement falsely indicated that she brought approximately $136, 900 to the closing to serve as a down payment. (Id. 28:8-29:19.)[1] He admitted that he received approximately $30, 000 of the illegal excess proceeds from the sale which funds were deposited by a co-conspirator into K.P.'s account, to which Mr. Souels had access and expended funds for his own benefit, including mortgage expenses for his own home and car payments for his own car and for travel. (Id. at 29:20-34:14.) Through these false and fraudulent documents, he caused Gateway Funding to release the purchase mortgage funds. (Id. 36:3-10). Petitioner does not dispute that the false mortgage loan application and false HUD-1 settlement statement caused the lender to extend two mortgage loans in the total amount of $478, 256.26 for K.P.'s straw purchase of Unit 203.

         At sentencing, consistent with the Presentence Report for this property at Unit 203, the loss figure was calculated to be $253, 256.26. (PSR ¶39; Tr. May 14, 2015 at 23:7-8.) This loss figure was computed as follows. Gateway Funding extended a total of $478, 256.26 in two separate mortgage loans ($411, 901.19 plus $66, 355.07) for K.P.'s purchase of Unit 203. No mortgage payments were made by anyone. West Coast Servicing had acquired the loan from Gateway in a pool of loans in December of 2007. (Statement of Steve J. Kraemer, President of West Coast Servicing, Inc., in FBI 302 by Special Agent Stefanowicz (Nov. 20, 2008), attached to Gov't Br. at Ex. D (hereinafter "Kraemer Report")). After taking possession of the property on April 10, 2008, West Coast Servicing resold the property for $225, 000.00, resulting in a loss of $253, 256.26. (Final PSR ¶95);[2]Kraemer Statement, supra, at Gov't Br., Ex. D. The loss of $253, 256.26 resulted in a 12-level enhancement under U.S.S.G. § 2B1.1(b)(1)(G), to which there was no objection at sentencing.[3]

         Petitioner now alleges that this loss calculation was erroneous and that his counsel was constitutionally ineffective for failing to object. The United States has timely filed its Answer.[4]

         The United States argues that the first two grounds, alleging a miscalculation of loss in the PSR, should be dismissed for lack of jurisdiction under § 2255, and that the third ground, alleging ineffective assistance of counsel with regard to the loss amount determination, should be denied for lack of merit. These arguments are next considered.

         II. DISC ...


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