United States v. Stephayne McClure-Potts, 908 F.3d 30

Background

McClure‑Potts lived with and assisted Artur Samarin, an unauthorized immigrant who used the alias “Asher Potts” to enroll in school. She obtained a Social Security number in that alias and used it (and related documents) to procure tax credits and state nutritional/medical benefits.
Investigations revealed falsified documents, prior deceptive convictions for McClure‑Potts, and evidence Samarin performed work and turned earnings over to her.
Federal indictment charged Social Security fraud (42 U.S.C. § 408(a)(6)), harboring an illegal alien (8 U.S.C. § 1324), and document/forced labor offenses; McClure‑Potts pled guilty to the Social Security fraud and harboring counts.
The PSR attributed $7,336 in fraudulent federal tax benefits and $13,653.28 in state nutritional/medical benefits to her conduct (total loss $20,989.28), producing a four‑level enhancement under U.S.S.G. § 2B1.1(b)(1)(C).
She sought a three‑level reduction under U.S.S.G. § 2L1.1(b)(1) for harboring “other than for profit” and objected to the loss calculation and the district court’s credibility findings; the district court adopted the PSR and sentenced her to five months.

Issues

Issue	Government's Argument	McClure‑Potts' Argument	Held
Whether § 2L1.1(b)(1) three‑level reduction applies (harboring “other than for profit”)	Benefits and in‑kind value (tax credits, state aid, household labor, money turned over) constitute "payment" or expectation of payment, so offense was for profit	No quid pro quo; benefits were dependent‑type support, not payment for harboring; plea omitted "for profit" language	Reduction denied: court holds Application Note One’s “payment” includes government benefits and in‑kind compensation, so conduct was not “other than for profit.”
Whether district court clearly erred in crediting Samarin’s testimony over McClure‑Potts	Samarin’s account corroborated by documents; district court properly assessed credibility	District court improperly credited an unavailable, self‑interested witness and relied on hearsay	No clear error: district court provided reasons (McClure‑Potts’ prior deception, document corroboration) and minimal indicia of reliability existed.
Whether state nutritional/medical benefits and federal tax credits count toward loss under U.S.S.G. § 2B1.1	Benefits and tax credits were reasonably foreseeable and resulted from fraudulent SSN; constitute relevant conduct/loss	Benefits were outside the charged offense/time period and/or unrelated state offenses; loss should be smaller or excluded	Loss affirmed: benefits and tax credits are relevant conduct and reasonably foreseeable pecuniary harm; total loss exceeded $15,000, triggering the 4‑level enhancement.
Whether sentencing court may rely on uncharged conduct spanning beyond indictment dates for loss calculation	Sentencing courts may consider relevant conduct beyond charged dates for Guidelines loss	Only charged conduct/time should be used	Held for Government: relevant‑conduct doctrine (U.S.S.G. § 1B1.3) permits inclusion of the broader course of conduct in loss.

Key Cases Cited

United States v. Kluger, 722 F.3d 549 (3d Cir.) (standard of review for Guidelines interpretation and application)
United States v. Loney, 219 F.3d 281 (3d Cir.) (use ordinary meaning for undefined Guidelines terms)
United States v. Al Nasser, 555 F.3d 722 (9th Cir.) (profit analysis focuses on the offense, not whether particular defendant received funds)
United States v. Perez‑Ruiz, 169 F.3d 1075 (7th Cir.) (in‑kind compensation counts as “payment” under § 2L1.1 commentary)
United States v. Siddons, 660 F.3d 699 (3d Cir.) (loss determination encompasses all relevant conduct in a scheme)
United States v. Robinson, 482 F.3d 244 (3d Cir.) (hearsay at sentencing must have minimal indicia of reliability)
Goldberg v. Kelly, 397 U.S. 254 (U.S. 1970) (welfare and benefit entitlements characterized as rights/property)
United States v. Jimenez, 513 F.3d 62 (3d Cir.) (government bears burden to prove loss by preponderance at sentencing)