399 F. App'x 105
6th Cir.2010Background
- Terbrack pleaded guilty to wire fraud arising from Marathon Financial’s mortgage-lending and funds diversion; Ginnie Mae guaranteed the loans and Marathon reported to Ginnie Mae monthly.
- Fraud began in July 1998 with diversion of mortgage-payoff proceeds to a Marathon account controlled by Terbrack and falsified wire reports to Ginnie Mae; Ginnie Mae discovered the scheme in October 2007 and Marathon was put in default.
- Ginnie Mae estimated its losses at over $22 million after liquidating Marathon’s loans; about 2000+ loans serviced, with over 2,000 total loans but most not implicated.
- Terbrack and Denise Money pled guilty; Money did not benefit from the fraud but helped identify fraudulent loans for Ginnie Mae; Terbrack led the scheme and misappropriated proceeds.
- District court conducted evidentiary sentencing; preliminary loss estimate was $21,578,095; contested credits included seven items claimed as collateral or offsets.
- District court credited escrow net value and Ginnie Mae carrying costs, rejected other items, resulting in a loss of $20,944,619 and an 78-month sentence for Terbrack; Money received a minimal sentence.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether claimed collateral credits reduce the loss estimate | Terbrack argues items are collateral under Note 3(E)(ii) | Terbrack contends Marathon assets are collateral because Ginnie Mae could pursue them | No items are collateral; loss estimate remains $20,944,619 |
| Whether the district court abused its discretion in sentencing disparity | Terbrack contends disparity with Money is unwarranted | Court may consider co-defendant disparities and Terbrack’s leadership and Money’s lesser role | Disparity within district court discretion; no abuse found |
Key Cases Cited
- United States v. Triana, 468 F.3d 308 (6th Cir. 2006) (limits when appellate review applies to loss and collateral issues)
- United States v. Wolfe, 71 F.3d 611 (6th Cir. 1995) (guidelines interpretation and deference to district court findings)
- United States v. Simmons, 501 F.3d 620 (6th Cir. 2007) (co-defendant disparity considerations and district court discretion)
- United States v. Wells, 127 F.3d 739 (8th Cir. 1997) (crediting a stream of payments; collateral/assignment distinctions)
- United States v. Calkins, 193 F. App’x 417 (6th Cir. 2006) (no collateral for previously unsecured payments; rejects broadened collateral notion)