United States v. Callaway, 762 F.3d 754

Callaway defrauded Bryant of $300,000 from a nursing home settlement by misrepresenting a charitable investment scheme; he converted funds to personal use and paid some small amounts only after Carter pressed him.
Carter, Bryant’s sister, held power of attorney and relied on Callaway’s supposed asset management; Bryant could not speak and needed care, creating vulnerability.
Callaway’s scheme involved the Environmental Protection of Asia Foundation; he claimed trustee status and a 12% return with funds piggybacked to his own investments.
Bryant’s funds were not lent to the foundation; repayments were inconsistent and far short of the $300,000 total, with later partial payments revealed as pretext.
At sentencing, the district court calculated loss at $300,000, applied a 2-level vulnerable-victim enhancement and a 2-level abuse-of-trust enhancement, and imposed a 71-month sentence concurrent on all counts with a $25,000 fine.
Callaway appealed challenging loss calculation, the vulnerable-victim enhancement, and the substantive reasonableness of the sentence.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Loss calculation accuracy for § 2B1.1 enhancement	Callaway contends repayments should reduce loss to under $300k	Government argues loss is intended/foreign to repayments	District court properly used $300,000 as loss; no plain-error in loss calculation
Vulnerable victim enhancement validity	Carter’s involvement shields Bryant; no nexus	Court properly applied 2-level enhancement for Bryant’s unusual vulnerability	Court correctly applied 2-level vulnerable-victim enhancement
Abuse-of-trust enhancement applicability	Callaway did not abuse a position of trust	Callaway held himself out as asset manager; enhancement proper	2-level enhancement for abuse of trust affirmed
Sentence substantively reasonable	Sentence too harsh given health and service history	Within-range, properly weighed § 3553(a) factors	71-month sentence within range; substantively reasonable
Fine amount reasonable given ability to pay	Fine should be lower given finances	Defendant could pay; fine at low end appropriate	$25,000 fine affirmed as reasonable based on earning capacity

United States v. Hartstein, 500 F.3d 790 (8th Cir. 2007) (crediting repayments against loss depends on intent to perpetuate fraud)
United States v. Lauer, 148 F.3d 766 (7th Cir. 1998) (intent to perpetuate scheme may justify not crediting repayments against loss)
United States v. Dengler, 695 F.3d 736 (8th Cir. 2012) (standard for procedural and substantive review of sentences)
United States v. Zauner, 688 F.3d 426 (8th Cir. 2012) (abuse-of-discretion review of § 3553(a) factors; within-range presumption)
United States v. Berndt, 86 F.3d 803 (8th Cir. 1996) (guideline-finance payment considerations; need to show ability to pay)