Case 3:10-cr-00221-VLB Document 14 Filed 01/13/11 Page 1 of 15

UNITED STATES DISTRICT COURT

DISTRICT OF CONNECTICUT

UNITED STATES OF AMERICA :

:
v. : 3:10CR00221 (VLB)
:
CARLOS GARCIA : JANUARY 13, 2010

DEFENDANT’S SENTENCING MEMORANDUM

The defendant, Carlos Garcia, through counsel, herewith submits his

memorandum in aid of sentencing.

I. History of the Case

Mr. Garcia waived his right to grand jury consideration of the charges

against him and pleaded guilty to a multi-count criminal information. He pleaded

guilty to the following counts: mail fraud, arising under 18 U.S.C. Section 1341;

wire fraud, in violation of 18 U.S.C. Section 1343; and, four counts of tax evasion,

in violation of 26 U.S.C. Section 7201. By way of a stipulation of offense conduct,

the parties agree that the fraud loss amount is $2,023,459.42, and that the tax loss

amount is $38,145. The total loss amount is $2,061,604.42.

II. General Sentencing Considerations

Although the federal sentencing guidelines are no longer mandatory,

United States v. Booker, 125 S.Ct. 738 (2005), they are far from moot. The Second

Circuit provided guidance to sentencing courts, instructing them that their duty

is to “consider” the Guidelines. United States v. Crosby, 397 F.3d 103 (2d Cir.,

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2005). Anticipating the need to sculpt a new category of sentences, the Circuit

offered the following formulation for sentences imposed in a “non-Guidelines”

manner. “We think it advisable to refer to a sentence that is neither within the

applicable Guidelines range nor imposed pursuant to the departure authority in

the Commission’s policy statements as a `non-Guidelines sentence’ in order to

distinguish it from the term `departure.’” Crosby, ___ at footnote 9.

All that the Second Circuit requires is that a Court “consider” the

Guidelines. United States v. Crosby, 397 F.3d 103 (2d Cir., 2005). Imposition of a

non-guideline sentence need only be reasonable. As Crosby noted, there are no

bright-line tests for determining what an appropriate sentence should be; mere

“robotic incantations” do not suffice when weighing the factors a sentencing

judge must consider.

III Factors To Be Considered At Sentencing

Various factors to be considered in imposing sentence are set forth in 18

USCA §§ 3553(a). Under §§ 3553(a), the sentencing court must impose a sentence

sufficient, but not greater than necessary, to comply with the purposes set forth

in 18 USCA §§ 3553(a)(2), which provides that the court, in determining the

particular sentence to be imposed, must consider the need for the sentence

imposed to (1) reflect the seriousness of the offense, to promote respect for the

law, and to provide just punishment for the offense; (2) afford adequate

deterrence to criminal conduct; (3) protect the public from further crimes of the

defendant; and (4) provide the defendant with needed educational or vocational

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training, medical care, or other correctional treatment in the most effective

manner. Section 3553(a) further provides that in determining the particular

sentence to be imposed, the court must also consider:

* The nature and circumstances of the offense and the history and

characteristics of the defendant.

* The kinds of sentences available.

* The kinds of sentences and the sentencing ranges established for the

applicable category of offense committed by the applicable category of

defendant as set forth in the guidelines issued by the Sentencing

Commission and in effect on the date the defendant is sentenced, or (in

the case of a violation of probation or supervised release) the applicable

guidelines or policy statements issued by the Sentencing Commission.

* Any pertinent policy statement issued by the Sentencing Commission that

is in effect on the date the defendant is sentenced.

* The need to avoid unwarranted sentence disparities among defendants

with similar records who have been found guilty of similar conduct.

* The need to provide restitution to any victims of the offense.

A sentencing court must impose a sentence of the kind, and within the

range, established by the relevant provisions of the Sentencing Guidelines,

unless the court finds that there exists an aggravating or mitigating circumstance

of a kind, or to a degree, not adequately taken into consideration by the

Sentencing Commission in formulating the guidelines that should result in a

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sentence different from that described. The court, in determining whether to

impose a term of imprisonment, and, if a term of imprisonment is to be imposed,

in determining the length of the term, must consider the factors set out in 18

USCA §§ 3553(a) to the extent that they are applicable.

In determining whether to make a recommendation concerning the type of

prison facility appropriate for the defendant, the court must consider any

pertinent policy statements issued by the Sentencing Commission pursuant to 28

USCA §§ 994(a)(2).

IV. The Guilty Plea In This Case And The Stipulation Of Offense Conduct

At the time of the defendant’s guilty pleas, the parties entered into a plea

agreement. That agreement, which the parties acknowledged is not binding upon

the Court, determined that the provable loss amount was $2,061,604.42. Given

this loss amount, and the grouping rules applicable to the offenses, the base

offense level adjusted for loss amount is 23. The parties agreed that there were

ten or more victims, a factor that warrants the addition of two levels to any

sentence this Court may impose under 2B1.1(b)(2)(A)(I). The parties agreed that

an additional two point addition was appropriate under for an abuse of position of

trust under 3B1.3. Finally, the parties agreed that the defendant was an

appropriate candidate for a three-point reduction in offense level because he

promptly accepted responsibility for his conduct. Section 3E1.1. Under the plea

agreement, the guidelines sentence is in the range of 51-63 months. Indeed, the

defendant waived any right to appeal a sentence of 63 months or less. The

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defendant also reserved the right at the time of sentencing to seek a downward

departure from a guidelines sentence or a non-guidelines sentence.

The pre-sentence report in this case reflects this agreement, but also

recommends an additional two point enhancement of the penalty based upon the

finding of a vulnerable victim, under section 3A1.1(b)(1). The Government, in its

sentencing memorandum, requests that this Court depart downward by two

levels if it finds a vulnerable victim enhancement appropriate in order give full

effect to the plea agreement. United States. v. Fernandez, 877 F.2s 1138, 1145 (2d

Cir. 1988). (Government’s Sentencing Memorandum, p. 9).

V. Nature of the Offenses

Although these are economic crimes, the defendant acknowledges the

harm he has done to others: these are not victimless crimes. Simply put, the

defendant ultimately ended up operating an investment scam in which

contributors to the fund he managed were mollified by funds from new

contributors. The defendant, meanwhile, funded his own needs out of funds he

had promised to invest on behalf of others. In the end, the investment scheme

came to operate as a classic Ponzi scheme.

The defendant had a long history in the investment business, and when he

created his own investment company, he intended to provide clients with

investment advice, earning fees from the returns he was able to find for his

clients. Like so many in recent years, his reach exceeded his grasp. The

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defendant takes no quarrel with the manner in which his business enterprise is

described in the pre-sentence report. Neither does he quarrel with the manner in

which his evasion of taxes is described.

VI. An Appropriate Sentence In This Case

The defendant now seeks a downward departure on two grounds:

extraordinary family circumstances under section 5H1.6 and/or multiple

circumstances under section 5K2.09 (c). In the alternative, the defendant seeks a

non-guidelines sentence.

A. Extraordinary Family Circumstances

Although the information in this case was filed in 2010, the investigation

commenced well before that date. Upon information and belief, federal authorities

began an investigation after a referral from the Guilford Police Department in

2008. (PSR, Para. 12) By the time law enforcement got involved in an

investigation, the defendant’s business enterprise had long-since collapsed, and

he and his family were forced to move to a more modest home. (PSR, para. 44)

Not long after their move, a daughter, Rachel, then 13, collapsed and died in the

family hope. She was 13 at the time of her death in November 2009. Rachel and

her brother Aaron were adopted by Mr. Garcia and his wife. The couple have one

child born from this union, Christine. Aaron is now 15 and Christine is now 11.

Rachel’s death was devastating both to Mr. Garcia and his wife, but

especially so to Aaron, who was adopted with Rachel. Aaron suffers significant

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psychological trauma as a result of the death of Rachel. (PSR, para. 40) The

defendant’s wife also reports that Aaron’s mental health issues are significant at

this time. (PSR, para. 42) The defendant’s wife “believes that Aaron and Christine

were traumatized by [Rachel’s death], as evidenced by Aaron’s recent struggles

with his mental health. Ms. Garcia said that the defendant’s guilty plea and

pending sentencing in this matter has further exacerbated the family stress level,

and she is concerned that her children can take only so much.... She does not

believe that her family will able to assist her and the children in anyway due to

their feelings for the defendant, and the financial damage he has inflicted on

them.” (PSR, para 42.)

The defendant also plays a pivotal role in the provision of care to his own

father, who lives in Bridgeport and is in poor health. (PSR, para. 34) Although Mr.

Garcia has two brothers, one, Robert, was born with a significant brain injury

and is unable to help provide care for their father. His other brother, Juan, is a

bartender who is apparently temperamentally unable or unwilling to assist in the

care of their father. The defendant’s mother and father are divorced, and his

mother now resides in Florida. (PSR, paras. 34-35)

Although downward departures for extraordinary family circumstances are

in general disfavored, Koon v. U.S. , 518 U.S. 81 (1996), our courts recognize that

“at some point, the nature and magnitude of family responsibilities may

transform the ordinary case ... into a case that is not at all ordinary.” U.S. v.

Rivera, 994 F.2d 942, 948 (1st Cir. 1993).

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The Commentary to 5H1.6 provides guidance on factors a Court may

consider in deciding whether to depart downward on account of family

responsibilities:

(A) In General. – In determining whether a departure is warranted under

this policy statement, the court shall consider the following non-exhaustive
list of circumstances:
(i) The seriousness of the offense.
(ii) The involvement in the offense, if any, of members of the
defendant’s family.
(iii) The danger, if any, to members of the defendant’s family as a
result of the offense.
(B) Departures Based on Loss of Caretaking or Financial Support. – A
departure under this policy statement based on the loss of caretaking or
financial support of the defendant’s family requires, in addition to the
court’s consideration of the non-exhaustive list of circumstances in
subdivision (A), the presence of the following circumstances:
(i) The defendant’s service of a sentence within the applicable
guideline range will cause a substantial, direct, and specific
loss of essential caretaking ... to the defendant’s family.
(ii) The loss of caretaking ... substantially exceeds the harm
ordinarily incident to incarceration for a similarly situated
defendant....
(iii) The loss of caretaking ... support is one for which no effective
remedial or ameliorative programs reasonably are available,
making the defendant’s caretaking .... support irreplaceable to
the defendant’s family.

Mr. Garcia requests that this Court depart downward or grant a non-

guideline sentence on the grounds family responsibility as he believes the unique

situation facing his family supports such a sentence. He recites the following

facts which support his claim:

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1. He is the adoptive father of two children, one of whom died

unexpectedly recently.

2. The surviving adoptee is emotionally vulnerable and in need of his

father’s caretaking as a result both of his status as an adopted child,

and as a result of his sister’s death.

3. Depriving the surviving adopted child of the defendant’s caretaking

is substantial, direct and specific loss..

4. The aforesaid mentioned loss exceeds that harm ordinarily incident

to incarceration given the special vulnerability of the adoptive child.

5. There is no effective remedial or ameliorative program reasonably

available.

6. The defendant is also in a unique and irreplaceable position as

caretaker for his elderly father.

B. Multiple Circumstances

Section 5K2.0 9 ( c) permits a departure:

based on a combination of two or more offender characteristics or other

circumstances, none of which independently is sufficient to provide a
basis for departure, only if –
(1) such offender characteristics or other circumstances, taken
together, make the case an exceptional one;
(2) each such offender characteristic or other circumstance is –
(A) present to a substantial degree; and
(B) identified in the guidelines as a permissible ground for
departure, even if such offender characteristic or other

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circumstance is not ordinarily relevant to a determination of

whether a departure is warranted.
The defendant here relies on the factors recited in the preceding section as

to extraordinary family responsibilities and on the mental health needs of his

natural child and his wife. In addition, he believes the number of victims, while

correct as a matter of head count, overstates the number of victims as a matter of

how the relevant accounts were managed in this case.

1. The Mental Health Needs of His Wife, Adopted Child and Natural
Child

While the trauma of separation from loved ones is normally incident to any

incarceration, there is a tragic element to this case that distinguishes it from

others. After law enforcement began to investigate the defendant, his business

folded. He and his family relocated to a different home. Unexpectedly, one of his

children then died. Thereafter, the defendant was charged in this case and has

now pleaded guilty. One of his surviving children is now struggling incident to

the suicide of his sibling. The family lacks the ability to provide for an alternative

caretaker for their son. The boy and his mother and surviving daughter face the

trauma of cascading losses, ranging from the relatively minor stresses resulting

from a move, to the death of a child and now the enforced absence of a father.

These losses take place against the unique background of strained relations with

the defendant’s wife’s extended family arising from the defendant’s misconduct.

It is not an exaggeration to say these stressors present a unique set of hardships.

In the event the Court finds them insufficient to grant a downward departure in

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their own right, the Court can, within the exercise of its discretion, concluded that

these stressors, taken with other unique characteristics in this case, warrant a

departure.

2. A Head Count Of The Number Of Victims Overstates The Harm

Paragraph 14 of the pre-sentence report tabulates the fraud losses in this

case arising from the defendants diversion of investment income provided to him

by clients. Although it lists a total of more than 10 people, in reality it reflects

misuse of the assets of nine individuals and/or couples. As the chart itself

reflects, there are nine columns yielding a total of $2,023,459.42 in loss. In the

cases of the Albert and Barbara Bishop, Alejandro Kaisan and Maria Cecilia

Gamondes, Roberty and Beverly Lentz, and Madelyn and James Lentz, the assets

invested were contributed by couples acting with a unity of purpose. While each

couple is obviously comprised of two persons, thus driving the number of

persons affected the defendants’ activities to 13, there were, in fact, but nine

accounts. Thus, while there were ten or more victims in the handling of these

nine accounts, the defendant contends that the guidelines place too great a

weight on the number

V. An Appropriate Sentence In This Case

The defendant now seeks a downward departure on two grounds:

extraordinary family circumstances under section 5H1.6 and/or multiple

circumstances under section 5K2.09 (c). In the alternative, the defendant seeks a

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non-guidelines sentence. A non-guidelines sentence can still serve the interests

of justice.

The defendant does not minimize or seek to excuse his misconduct. The

fraud he engaged in deprived several families of significant funds, in some cases

placing retirement prospects at risk and placing a dark cloud over golden years

planned for long in advance. He has pleaded guilty to a felony in open court. He

has agreed to make restitution. He now faces the world as a convicted felon,

unable to obtain a license to work in a regulated industry as a result of his own

acts.

Yet for all that, his crimes seem less shocking than they might have

appeared before the most recent burst of the real estate bubble. It seemed for a

time as though the entire nation were dizzy with greed and caught in the grip of a

speculative fever than made cutting corners and deception look like accepted

practices to far too many professionals. Mr. Garcia is no mere product of the

times, but he is, nonetheless, a product of an environment in which easy gain

was regarded as a matter of right by investors.

This is Mr. Garcia’s first and only offense. He is the adoptive father of

children, a caring and loving husband, a devoted son, and a person who has

given much to his community. His fall from grace has been fast and dramatic, and

it has been accentuated by the death of his daughter. A sentence of many years

might be appropriate for a lesser man, a man more comfortable with the dark side

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of the law. Mr. Garcia permitted himself to be caught up in a web of bad

investments that he sought to cover by resorting to deception. His crime is a lack

of honesty, not a crime of violence. The court might well regard him with some

leniency as there is no evidence to suggest that he is a hardened and habitual

criminal.

What drives the sentence to a large degree in this case in the loss amount.

But for the loss amount, the defendant would be facing a sentence in the range of

one year. Surely, Congress intended to penalize greater losses with greater

penalties: that serves an interest in proportionate punishment. Yet a sentence

that transforms Mr. Garcia into a stranger to the children who need him now more

than ever works a disproportionate cruelty on children who were not part of the

crime that brings us to this Court. What’s more, incarcerating Mr. Garcia for a

lengthy period makes it far less likely that he will be able to generate any

meaningful restitution for his victims, or that he will be able to pay the taxes

owed the Government.

There is no need for specific deterrence in this case. Mr. Garcia appears

before the Court a shattered man. He has lost his standing in the community, and

now a child. While the two losses are factually unrelated, they are nonetheless

experienced by Mr. Garcia as double blows directed against his overweening sins

of pride and greed. Requiring him to serve his community is the sort of

restorative and therapeutic justice a mature criminal justice system might

embrace.

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It is almost certainly too much to hope that Mr. Garcia will be spared

imprisonment. His crime is serious, and the need for general deterrence is great.

But justice untempered by mercy has a hollow ring to it. Mr. Garcia’s family needs

are extraordinary; he is required to make a great amount of restitution. Placing

him in prison merely exposes his son to even greater mental health risk while

frustrating the elderly victims who risked retirement funds on bad investments.

Prison for Mr. Garcia deprives both his son and his victims of the support they

need. In a sense, prison is too easy and convenient a path for a man who has

fouled his own prospects.

Mr. Garcia requests leniency from this Court in terms of his imprisonment.

He wants the chance to begin to make right his many wrongs.

THE DEFENDANT

By_______________________________
NORMAN A. PATTIS
649 Amity Road
Bethany, CT 06524
203.393.3017
203.393.9745 (fax)
ct13120

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CERTIFICATION

I hereby certify that on January 13, 2010, a copy of the foregoing was filed
electronically and served by mail on anyone unable to accept electronic filing.
Notice of this filing will be sent by email to all parties by operation of the Court’s
electronic filing system or by mail to anyone unable to accept electronic filing as
indicated on the Notice of Electronic Filing. Parties may access this filing through
the Court’s CM/ECF System.

__________/s/____________________
NORMAN A. PATTIS

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