United States v. Terri Killen
2014 U.S. App. LEXIS 15007
| 8th Cir. | 2014Background
- Terri Killen pleaded guilty to making a false statement to the Social Security Administration in connection with receipt of SSI benefits. She received $14,840 in improper benefits and failed to report bank accounts, gambling winnings, income, and changes in living arrangements.
- PSR calculated actual loss of $14,840 and projected intended additional benefits of about $110,536 if undiscovered, giving a total potential loss used by the PSR of roughly $125,376.
- The PSR recommended a ten-level Guidelines increase based on that larger figure; the government and Killen both objected to using intended loss (each advocated actual loss), though neither disputed the underlying arithmetic in the PSR.
- The district court found by a preponderance of the evidence that Killen intended to continue collecting benefits until retirement and applied intended loss (as calculated in the PSR), resulting in a higher offense level and an 18-month sentence.
- Killen appealed, arguing the district court erred by using intended loss, improperly shifting the government’s burden of proof, requiring additional mens rea evidence, and misapplying Guideline comment 3(F)(ii).
Issues
| Issue | Plaintiff's Argument (Killen) | Defendant's Argument (Government / District Court) | Held |
|---|---|---|---|
| Proper measure of "loss" under U.S.S.G. § 2B1.1 — actual vs. intended | Use actual loss only (limit enhancement) | Intended loss may be used where defendant intended to continue receiving benefits | Court: Intended loss may be used; district court reasonably found Killen intended continued receipt |
| Burden of proof — did court shift burden to Killen | Government previously argued actual loss; court improperly shifted burden to Killen to disprove intended loss | District court relied on uncontested PSR facts; did not shift burden | Court: No improper burden shift; government met preponderance via PSR facts and court inference |
| Need for additional mens rea evidence to prove ‘‘intended loss’’ | Court required subjective proof of intent to continue benefits | Court may infer intent from conduct and the natural/probable consequences of actions | Court: No extra mens rea evidence required; intent properly inferred from conduct (consistent with precedent) |
| Applicability of U.S.S.G. §2B1.1 cmt. n.3(F)(ii) (govt-benefits rule) | Note 3(F)(ii) mandates loss be at least value obtained, pointing toward actual-loss baseline | 3(F)(ii) applies only where defendant received both proper and improper payments; here all payments were improper | Court: 3(F)(ii) does not mandate actual-loss calculation here; it does not preclude intended-loss approach |
Key Cases Cited
- United States v. Frisch, 704 F.3d 541 (8th Cir.) (upholding use of intended loss in SSA-benefits fraud where defendant likely would have continued collecting)
- United States v. Hodge, 588 F.3d 970 (8th Cir.) (standard of review for loss calculation; government bears burden by preponderance)
- United States v. Levine, 477 F.3d 596 (8th Cir.) (deference to district court on loss calculation)
- United States v. Manatau, 647 F.3d 1048 (10th Cir.) (discussion of mens rea for intended loss, but recognizing inference of intent is permissible)
- United States v. Tupone, 442 F.3d 145 (3d Cir.) (interpretation of comment 3(F)(ii) in government-benefits context)