PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

UNITED STATES OF AMERICA,
Plaintiff-Appellee,

v.                                                                   No. 98-4271

THOMAS EDWARD KARAM,
Defendant-Appellant.

Appeal from the United States District Court
for the District of Maryland, at Greenbelt.
Alexander Williams, Jr., District Judge.
(CR-97-194-AW)

Argued: September 24, 1999

Decided: January 6, 2000

Before MURNAGHAN and NIEMEYER, Circuit Judges, and
Frank MAGILL, Senior Circuit Judge of the United States Court of
Appeals for the Eighth Circuit, sitting by designation.

_________________________________________________________________

Affirmed by published opinion. Senior Judge Magill wrote the opin-
ion, in which Judge Murnaghan and Judge Niemeyer joined.

_________________________________________________________________

COUNSEL

ARGUED: Donna M. D'Alessio, EASTWICK, ROSE & WRIGHT,
P.A., Baltimore, Maryland, for Appellant. Sandra Wilkinson, Assis-
tant United States Attorney, UNITED STATES ATTORNEY'S
OFFICE, Greenbelt, Maryland, for Appellee. ON BRIEF: Margaret
Lee Norton, EASTWICK, ROSE & WRIGHT, P.A., Baltimore,
Maryland, for Appellant. Lynne A. Battaglia, United States Attorney,
UNITED STATES ATTORNEY'S OFFICE, Greenbelt, Maryland,
for Appellee.

_________________________________________________________________

OPINION

MAGILL, Senior Circuit Judge:

On May 28, 1997, Thomas E. Karam (Karam) was indicted for
wire fraud in violation of 18 U.S.C. § 1343, 1 money laundering in vio-
lation of 18 U.S.C. § 1957, and aiding and abetting in violation of 18
U.S.C. § 2. On September 12, 1997, Karam pled guilty to a single
count of wire fraud. The remaining counts were dismissed. The dis-
trict court2 sentenced Karam to twenty-four months imprisonment and
ordered him to pay restitution in the amount of $774,508. Karam
appeals the district court's restitution order. We affirm.

I.

Karam, a certified public accountant, was the managing partner of
Berlin, Karam, and Ramos, P.A. (BKR), an accounting firm located
in Silver Spring, Maryland. In approximately 1974, Karam and BKR
began providing accounting, bookkeeping, and tax preparation ser-
vices to Fairfax Anesthesiology Associates, Inc. (FAA). BKR col-
lected all fees paid to FAA physicians by the billing unit of the
hospital where they practiced and used these fees to pay physicians'
_________________________________________________________________
1 18 U.S.C. § 1343 provides:

          Whoever, having devised or intending to devise any scheme or
          artifice to defraud, or for obtaining money or property by means
          of false or fraudulent pretenses, representations, or promises,
          transmits or causes to be transmitted by means of wire, radio, or
          television communication in interstate or foreign commerce, any
          writings, signs, signals, pictures, or sounds for the purpose of
          executing such scheme or artifice, shall be fined under this title
          or imprisoned not more than five years, or both.
2 The Honorable Alexander Williams, Jr., United States District Judge
for the District of Maryland.

                    2
bonuses, taxes, and other expenses. Because most FAA physicians'
compensation was paid in the form of quarterly bonuses, FAA accu-
mulated large amounts of cash between distribution dates. At FAA's
request, Karam began investing these accumulated funds in order to
obtain a profitable rate of return.

Some years after he began his relationship with FAA, Karam began
providing similar accounting, bookkeeping, and tax preparation ser-
vices to an entity known as Radiology Employees Pension and Profit
Sharing Plan (REPP). Karam's uncle, Dr. Edward Soma (Dr. Soma),
was a trustee and major participant in REPP at all relevant times.

In late 1985, Karam formed an entity known as Management Advi-
sors, Inc. (MAI) to facilitate client investments. MAI acted as an
intermediary for many FAA loans and other investments. Karam con-
trolled MAI at all relevant times. Also in the 1980s, Karam became
actively involved with Tyra Cosmetics, Inc. (Tyra). Karam owned a
substantial amount of Tyra's outstanding shares and, at certain times,
controlled a majority of Tyra's stock. In 1987, Karam and others
formed the Bank of Northern Virginia (BNV). Karam served on
BNV's board of directors until 1993.

At some time prior to 1990, without the knowledge or authoriza-
tion of any FAA physician, Karam began instructing BNV employees
to transfer funds from FAA's account to MAI's account. Karam took
some of the funds for himself in transactions he claims were loans to
him from MAI. He used other such monies to fund Tyra, which
absent these cash infusions would have been forced to curtail its oper-
ations. Before 1990, Karam promptly repaid the funds he transferred
from FAA with other funds properly at his disposal. In late 1990,
however, primarily because of Tyra's accelerating cash flow prob-
lems, MAI was unable to locate sufficient funds to repay FAA.

In late 1990, to ensure FAA did not suffer cash flow problems due
to MAI's activities, Karam transferred $500,000 from Dr. Joseph
Finizio's (Dr. Finizio) BNV account to FAA's BNV account. Nine
months later, Karam transferred an additional $250,000 from Dr.
Finizio's BNV account to FAA. Karam completed these transfers
without the knowledge or authorization of FAA or Dr. Finizio. In
June 1990, Karam caused employees at BNV to transfer $500,000

                    3
from REPP to FAA, without the advance knowledge or authorization
of any REPP trustee. Karam subsequently ordered an additional trans-
fer of $1.2 million from REPP to FAA without authorization.

One of Karam's responsibilities as FAA's accountant and book-
keeper was to assure that FAA's quarterly payroll taxes were paid in
a timely fashion to the Commonwealth of Virginia and the United
States Internal Revenue Service. In June 1992, however, Karam
knowingly failed to pay approximately $500,000 of FAA's payroll tax
liability. Karam's activities had drained FAA of sufficient funds to
meet its tax obligations. Karam also failed to pay a portion of FAA's
payroll tax liabilities for the quarters ending in September and
December 1992. Karam concealed his failures to meet payroll tax
obligations from FAA and his partners at BKR.

In December 1992, Karam invited individual FAA physicians to
"defer" their FAA bonuses and invest in Tyra. Fourteen FAA physi-
cians decided to invest approximately $903,000 in Tyra (Tyra Loans).
Each of the fourteen physicians received a promissory note from Tyra
bearing a 15% interest rate. At the time these investment decisions
were made, FAA physicians did not know that FAA had insufficient
funds in its account to pay their bonuses because Karam had stolen
FAA funds for his personal benefit. No physical transfer of money
was ever actually made from FAA to Tyra. Karam repaid only
$170,000 of the original $903,000 in Tyra Loans.

Sometime between late 1992 and early 1993, FAA and Karam's
partners at BKR discovered Karam's misconduct. Karam resigned
from BKR in May of 1993. Beginning in approximately January
1993, and continuing over the course of approximately the next two
years, Karam arranged for the repayment of a substantial portion of
the funds he had transferred without authorization. Civil litigation
between the parties resulted in a settlement with mutual releases
between Karam, REPP, FAA, and others.3
_________________________________________________________________
3 As part of the civil settlement, FAA retained a $543,000 promissory
note that Karam had provided in May 1993. FAA also received a cash
distribution in the amount of $275,000, plus interest. Karam paid REPP
$1.2 million in cash as part of the civil settlement.

                   4
Karam was indicted for wire fraud and money laundering on May
28, 1997. The indictment charged a scheme to defraud between 1990
and early 1993. The alleged scheme included the transfer of $4 mil-
lion from FAA and $1.7 million from REPP. The scheme also
included Karam's attempts to conceal his activity by obtaining prom-
issory notes under false pretenses and by lying to his clients. Karam
pled guilty to one count of wire fraud.4

The district court ordered restitution in the amount of $774,508.
Karam challenges the restitution order in this appeal. For reasons to
be discussed, we affirm the district court's restitution order in its
entirety.

II.

Karam first argues the district court erred by including losses from
the Tyra Loans in its restitution award because these loans were not
directly related to the conduct underlying his conviction. In general,
criminal restitution orders should not be overturned in the absence of
an abuse of discretion. See United States v. Henoud, 81 F.3d 484, 487
(4th Cir. 1996). We have repeatedly observed, however, that a trial
court's discretion in ordering restitution is "circumscribed by the pro-
cedural and substantive protections" in the Victim and Witness Pro-
tection Act (VWPA), 18 U.S.C. §§ 3663, 3664. United States v.
Bailey, 975 F.2d 1028, 1031 (4th Cir. 1992); United States v.
Bruchey, 810 F.2d 456, 458 (4th Cir. 1987).
_________________________________________________________________
4 Count XIV, the offense of Karam's conviction, charged that:

          Thomas E. Karam . . . for the purposes of executing and attempt-
          ing to execute the aforementioned scheme and artifice to
          defraud, did knowingly, willfully and unlawfully cause to be
          transmitted in interstate commerce, by means of wire communi-
          cation, certain signs and signals; that is, a telephone communica-
          tion from the offices of BKR in Silver Spring, Maryland to BNV
          in Arlington, Virginia requesting a transfer of $150,000 from a
          bank account of FAA maintained at BNV to the bank account of
          MAI maintained at BNV.

Count XIV specifically incorporated all of the factual allegations con-
tained in the first eighteen paragraphs of Count I. These paragraphs detail
Karam's scheme to defraud FAA, REPP and others.

                    5
Under the VWPA, a district court may order a convicted criminal
to pay restitution to "any victim" of his offense. See 18 U.S.C.
§ 3663(a)(1). The VWPA defines a "victim" as "any person directly
harmed by the defendant's criminal conduct in the course of the
scheme, conspiracy, or pattern." 18 U.S.C. § 3663(a)(2). Federal
courts may order restitution encompassing losses resulting from a
criminal scheme "regardless of whether the defendant is convicted for
each criminal act within the scheme," so long as the loss is a direct
result of the defendant's criminal conduct or is"`closely related to the
scheme.'" United States v. Henoud, 81 F.3d 484, 488 (4th Cir. 1996)
(quoting United States v. Kones, 77 F.3d 66, 69 (3rd Cir. 1996)). We
find that the Tyra Loans were directly related to the conduct underly-
ing Karam's conviction, and thus, were properly included in the dis-
trict court's restitution order.

The district court found that the Tyra Loans were part of Karam's
"massive scheme" to defraud FAA. Moreover, by pleading guilty,
Karam admitted that he "obtained promissory notes from clients and
others by means of false and fraudulent representations and promises,
which he used to conceal and perpetuate his criminal conduct." This
admission clearly encompasses Karam's use of the Tyra Loans to
deceive FAA and FAA physicians for his personal benefit.5

III.

Karam contends that the government failed to meet its burden of
establishing the amounts of restitution due FAA and REPP.6 Karam
specifically argues that the government failed to establish that the
Tyra Loans resulted in actual loss to FAA for two reasons: 1) the phy-
sicians who made the loans agreed to cancel the underlying debt for
_________________________________________________________________
5 Failure to identify the Tyra Loans by name is not a fatal mistake. See
United States v. Bailey, 975 F.2d 1028, 1033-34 (4th Cir. 1992).
Although the indictment refers to promissory notes obtained "from cli-
ents," rather than given to clients, we find that the quoted language
clearly encompasses the Tyra Loans.
6 We note that the district court ordered restitution to FAA in the
amount of $389,508 and to REPP in the amount of $385,000. The total,
$775,508, is the same figure as the loss stipulated in the plea agreement.

                    6
tax reasons; and 2) any loss suffered by individual physicians was not
suffered by FAA. We reject these arguments.

Karam admits that he encouraged individual FAA physicians to
"defer" their FAA bonuses and invest $903,000 in Tyra. Only
$170,000 of this amount has been repaid. Karam argues, however,
that the government failed to prove that FAA physicians suffered any
loss because the physicians intended to cancel their loans in order to
qualify for certain tax benefits. We reject this argument. The govern-
ment met its burden of proving actual loss by establishing that the
Tyra Loans were never fully repaid. After the government made this
showing, the burden of proving any impermissible"double recovery"
fell on Karam. See United States v. Parsons, 141 F.3d 386, 393 (1st
Cir. 1998). Karam failed to meet this burden. Karam did not introduce
any evidence that FAA physicians actually claimed Tyra Loan losses
on their tax returns.

Karam next argues that FAA did not suffer any loss because of
individual FAA physician investment decisions. We reject this argu-
ment. The record clearly shows that FAA did not have money to pay
physicians their bonuses at the time these bonuses were supposedly
"deferred" to invest in Tyra. Moreover, the supposed "deferral"
allowed Karam to continue his deceit of FAA by hiding the shortfall
caused by his unlawful activities. Although this money would have
ultimately been paid to the investing physicians, Karam's clever
accounting maneuvers depleted FAA's account of the funds it would
have used to pay the physicians' bonuses.

Karam also argues that the government failed to prove actual loss
to REPP of at least $385,000. We disagree. Dr. Ronald Pomerantz
(Dr. Pomerantz), a REPP trustee, testified that the total loss to REPP
was $500,000. Pomerantz arrived at this figure by subtracting from
$1.7 million the $1.2 million paid to REPP as part of the civil settlement.7
Karam argues that the $1.7 million in total withdrawals from REPP
to FAA was based on three separate transactions, one of which was
not part of Karam's criminal conduct. Specifically, Karam relies on
_________________________________________________________________
7 The government contends that the reason for the discrepancy between
$500,000 and $385,000 is that the government made an arithmetic error
when calculating fraud loss for purposes of the plea agreement.

                    7
language in the plea agreement that $1.2 million was withdrawn with-
out authorization, while $500,000 was withdrawn without "advance"
authorization. We find Karam's argument unpersuasive.

The entire $1.7 million was included in the indictment as part of
Karam's scheme to defraud. Moreover, Dr. Soma, Karam's uncle and
a REPP trustee, testified that all three transactions were made without
prior knowledge or authorization. Similarly, Dr. Pomerantz, the other
REPP trustee, testified that the transfer was not authorized by anyone
at REPP. In light of this testimony and language in the indictment, we
find that the district court properly included the entire $1.7 million in
its restitution order.

IV.

Karam contends that the district court erred in failing to offset the
restitution award by amounts the victims received as compensation
for losses caused by Karam's criminal scheme. Specifically, Karam
argues that Dr. Soma's restructuring of his own pension plan fully
absorbed any loss suffered by REPP. Karam also argues that certain
promissory notes fully compensated FAA and REPP for losses caused
by his unlawful conduct. We reject Karam's arguments.

(A) Civil Settlement

Section 3663(e)(1) of the VWPA provides that "[t]he Court shall
not impose restitution with respect to a loss for which the victim has
received or is to receive compensation, except that the court may, in
the interest of justice, order restitution to any person who has com-
pensated the victim for such loss to the extent that such person paid
the compensation." Although the government bears the burden of
proving loss under the VWPA, the defendant bears the burden of
proving that he has compensated or will compensate the victim. See
United States v. Sheinbaum, 136 F.3d 443, 449 (5th Cir. 1998). The
Fifth Circuit recently explained why the defendant should bear the
burden of proving that the victim has been compensated in such a
manner so as to preclude restitution under the VWPA:

          Logically, the burden of proving an offset should lie with
          the defendant. The statute allocates the various burdens of

                     8
         proof among the parties who are best able to satisfy those
         burdens and who have the strongest incentive to litigate the
         particular issues involved. Having investigated the crime
         and wishing to provide as strong a deterrent as possible, the
         government is best suited to persuade the court as to the
         amount of loss caused by the offense. On the other hand, the
         defendant is better positioned to proffer evidence about his
         own financial resources and needs, and his desire to lower
         his restitution order gives him the incentive to litigate such
         mitigating circumstances. In a similar vein, the defendant
         should know the value of any compensation he has already
         provided to the victim in civil proceedings, so the burden
         should fall on him to argue for a reduction in his restitution
         order by that amount.

Id. We agree.

Karam argues that personal guarantees executed in the form of
promissory notes constituted full and complete compensation for his
victims.8 Karam failed to raise this argument at sentencing. Thus,
Karam's argument is subject to review for plain error. Four conditions
must be met in order for there to be plain error under Rule 52(b):
_________________________________________________________________
8 Karam caused the notes representing REPP's "loans" to FAA and cer-
tain other notes to be replaced by ten civilly enforceable promissory
notes (Replacement Notes) made payable to REPP. The Replacement
Notes were for a total of $2,595,000, collectively, and replaced the
$500,000 and the $1.2 million notes from FAA, and notes from Drs.
Kennedy and Sirh in the amounts of $260,000 and $390,000.

In 1993, three of the ten Replacement Notes were satisfied in full, rep-
resenting a payment of $345,000. Karam contends that the district court
should have credited much of this amount against the losses caused by
his unlawful transfer of REPP funds to FAA, rather than solely to the
Kennedy and Sirh debt. We disagree. Dr. Pomerantz, a REPP trustee, tes-
tified that there was no principled way to apply the $345,000 to any of
the notes because money is fungible. In other words, regardless of where
REPP credits the $345,000 payment, the bottom-line remains unaffected.
Given the lack of any crediting principle, we conclude that the district
court did not commit plain error in failing to credit the $345,000 pay-
ment towards the debts of FAA.

                   9
there must be (1) an error, such as a deviation from a legal rule; (2)
the error must be plain, meaning obvious, or at a minimum, clear
under current law, (3) the error must affect substantial rights--in
other words, the error must be so prejudicial as to affect the outcome
of the proceedings in the district court; and(4) the reviewing court
must determine if the error "`seriously affects the fairness, integrity
or public reputation of judicial proceedings.'" United States v. Hanno,
21 F.3d 42, 45 (4th Cir. 1994) (quoting United States v. Olano, 507
U.S. 725, 736 (1993)). Appellants bear the burden of proof with
respect to the prejudice of their rights. See Olano, 507 U.S. at 734.

We have suggested in dicta9 that a promissory note voluntarily exe-
cuted as part of a settlement agreement would constitute full and
immediate restitution. See United States v. Bruchey, 810 F.2d 456,
460 (4th Cir. 1987). The Bruchey court went on to note that once a
district court found such an agreement, it "would have no further role
to play under the VWPA. The victim would simply enforce the civil
obligation through the ordinary civil process." Id. We decline to adopt
the Bruchey dicta and instead hold that a voluntarily executed promis-
sory note does not necessarily constitute full and complete restitution
under the VWPA.

A civil settlement does not preclude an award of restitution under
the VWPA because restitution under the VWPA is primarily penal in
nature. See United States v. Cloud, 872 F.2d 846, 854 (9th Cir.), cert.
denied, 493 U.S. 1002 (1989); United States v. Sheinbaum, 136 F.3d
443, 447-48 (5th Cir. 1998). Restitution pursuant to the VWPA is
designed to serve the rehabilitative and retributive purposes of the
criminal law, rather than merely compensate victims with an amount
to which they feel entitled.10See Sheinbaum, 136 F.3d at 447-48. The
_________________________________________________________________
9 The facts in Bruchey, briefly stated, were that the district court had
compelled the defendant to sign a long-term promissory note payable to
the victim as a form of restitution. Because the court failed to make spe-
cific findings of fact, and because the term of the restitution order
exceeded time limits established by the VWPA, this court vacated and
remanded. See id. at 458-60. The existence of a promissory note or other
settlement agreement was, therefore, not material to the court's judg-
ment.
10 In Kelly v. Robinson, the Supreme Court commented broadly about
the purpose of restitution in the criminal law:

                    10
fact that Karam's victims may have accepted certain promissory notes
as full compensation does not necessarily determine whether these
victims are entitled to restitution pursuant to the VWPA.11 Rather, the
critical question is whether the victims have been actually
compensated for losses caused by a defendant's criminal conduct. In
this case, Karam failed to meet his burden of proving that certain
promissory notes fully compensated his victims for injuries caused by
his misconduct.
_________________________________________________________________

          The criminal justice system is not operated primarily for the ben-
          efit of victims, but for the benefit of society as a whole. Thus,
          it is concerned not only with punishing the offender, but also
          with rehabilitating him. Although restitution does resemble a
          judgment "for the benefit of" the victim, the context in which it
          is imposed undermines that conclusion. The victim has no con-
          trol over the amount of restitution awarded or over the decision
          to award restitution. Moreover, the decision to award restitution
          generally does not turn on the victim's injury, but on the penal
          goals of the State and the situation of the defendant.

479 U.S. 36, 52 (1986). Although these comments were aimed only at
a state restitution system, the Court hinted in a footnote that they might
apply to the VWPA as well. See id. at 53 n.14. Indeed, nearly every cir-
cuit to have addressed the question has taken Kelly to mean that the
VWPA is penal, not compensatory, in nature. See Bruchey, 810 F.2d at
460 n.*; United States v. Sheinbaum, 136 F.3d 443, 447-48 (5th Cir.
1998), cert. denied, 493 U.S. 1002 (1989); United States v. Savoie, 985
F.2d 612, 619 (1st Cir. 1993); United States v. Vetter, 895 F.2d 456, 459
(8th Cir. 1990); United States v. Hairston, 888 F.2d 1349, 1355 (11th
Cir. 1989); United States v. Cloud, 872 F.2d 846, 854 (9th Cir. 1989).

11 We do not by our holding mean to imply that REPP or FAA may
obtain a double recovery for injuries resulting from Karam's criminal
scheme. The VWPA itself expressly forecloses this possibility. In this
case, the district court was fully apprised of, and clearly considered, the
existence and terms of the settlement agreement between the parties.
Karam simply failed to meet his burden of proving that the victims were
fully compensated as a result of the settlement or any voluntarily exe-
cuted promissory notes.

                     11
(B) Dr. Soma's Pension Account

At the time of sentencing, Karam argued that, in addition to the
$1.7 million that was transferred from REPP to FAA, he used REPP
money to "loan" money to Tyra. Two of these three transactions,
which totaled $650,000 (REPP Loans), were not authorized and were
never repaid. After the discovery of Karam's scheme, REPP partici-
pants thought that Dr. Soma should bear any loss caused by his neph-
ew's unauthorized transfer of funds while he was serving as REPP
trustee. At the time of REPP's liquidation, Dr. Soma accepted the
REPP Loans as part of his personal portfolio, thereby fully absorbing
any loss caused by his nephew's misconduct.

Karam now argues that the district court erred in failing to offset
any compensation due REPP because Dr. Soma's restructuring of his
personal portfolio fully compensated REPP for losses caused by the
REPP Loans. We reject this argument. Although REPP may have
focused the entire loss on one of its members, the fact remains that
REPP was never made whole for the loss caused by the REPP Loans.
In short, despite Dr. Soma's assumption of the REPP Loans, the loss
remained entirely within the ranks of the REPP membership.

V.

Karam claims that the district court erred in not making specific
factual findings regarding his ability to pay before ordering him to
pay full restitution for all losses caused by the offense of his convic-
tion. We have consistently held that the 1992 VWPA requires the dis-
trict court to make specific factual findings with respect to a
defendant's financial resources, financial needs, and earning abilities.
See United States v. Castner, 50 F.3d 1267, 1277 (4th Cir. 1995);
United States v. Plumley, 993 F.2d 1140, 1142-43 (4th Cir. 1993) (per
curiam); United States v. Bailey, 975 F.2d 1028, 1031 (4th Cir. 1992).
Under the 1992 VWPA, these findings must be keyed to the amount
of restitution ordered. See Castner, 50 F.3d at 1277. We have held
that a sentencing court satisfies its duty to make specific findings if
it adopts a presentence report "that contains adequate factual findings
to allow effective appellate review of the fine or restitution." Id. at
1277 (4th Cir. 1995); United States v. Molen, 9 F.3d 1084, 1086-87
(4th Cir. 1993), cert. denied, 511 U.S. 1071 (1994).

                    12
The Mandatory Victims Restitution Act of 1996 (MVRA) substan-
tially amended the 1992 VWPA by requiring district courts to impose
"full" restitution without considering the defendant's economic cir-
cumstances. See 18 U.S.C. § 3664(f)(1)(A). Under the 1992 VWPA
the procedure is reversed: the court must first consider the defendant's
financial circumstances before setting the amount of restitution to be
paid. See 18 U.S.C. § 3664(a) (1995). Because Karam's criminal
activity occurred before the MVRA's effective date, 12 Karam claims
that its retrospective application would violate the Ex Post Facto
Clause of the United States Constitution.13

In this case, the record does not disclose which statute the district
court relied on when making its restitution order. Assuming, without
deciding, that the district court was required to apply the 1992
VWPA, Karam failed to object to the district court's failure to make
the required factual findings at the time of sentencing. When a defen-
dant fails to object at sentencing to the calculation of restitution, the
defendant waives appellate review except for plain error. See Castner,
50 F.3d at 1277. In this case, we find that Karam failed to show that
the district court's alleged failure to make specific factual findings
prejudiced his rights in any way.

In this case, the district court found that Karam was in a position
to pay "some restitution." Although the district court did not make
_________________________________________________________________
12 The MVRA states that it "shall, to the extent constitutionally permis-
sible, be effective for sentencing proceedings in cases in which the
defendant is convicted on or after [April 24, 1996]." 18 U.S.C. § 2248
(statutory notes).

13 Several circuits have ruled that applying the MVRA to criminal con-
duct committed before the MVRA's enactment violates the Ex Post
Facto Clause because restitution imposed as part of a defendant's sen-
tence is a criminal punishment, and not a civil sanction. See United
States v. Edwards, 162 F.3d 87 (3d Cir. 1998); United States v. Siegel,
153 F.3d 1256, 1259-61 (11th Cir. 1998); United States v. Williams, 128
F.3d 1239, 1241 (8th Cir. 1997); United States v. Baggett, 125 F.3d
1319, 1322 (9th Cir. 1997); United States v. Thompson, 113 F.3d 13, 15
n.1 (2d Cir. 1997). But see United States v. Newman, 144 F.3d 531, 538-
40 (7th Cir. 1998) (holding that restitution is not criminal punishment for
purposes of the Ex Post Facto Clause).

                     13
independent findings regarding Karam's ability to pay restitution, it
did adopt the factual findings of the Presentence Investigation Report
(PSR). The PSR reveals that Karam is a well-educated man with
extensive experience in managerial and entrepreneurial endeavors.
Despite Karam's negative net worth at the time of sentencing, the dis-
trict court could have concluded that this setback was only temporary.
A negative net worth at the time of sentencing does not necessarily
indicate an inability to pay, especially when the PSR establishes that
a defendant has knowledge and skills in the areas of financial plan-
ning, business administration and corporate strategies. See, e.g.,
Bailey, 975 F.2d at 1032.

In sum, Karam has not demonstrated a sufficient probability that
the amount of restitution would have been different had the court
made specific factual findings regarding his ability to pay. He has not,
therefore, shown that the error was a defect affecting substantial
rights, which is the third prerequisite for obtaining relief under Rule
52(b). In short, because Karam's PSR contains sufficient facts to sup-
port the imposition of restitution, we conclude that under the plain
error standard, the district court did not err in calculating his restitu-
tion.

VI.

Karam next contends that his sentence is illegal because the district
court denied him his right to allocution in violation of Federal Rule
of Criminal Procedure 32(c)(3). We disagree. Karam never objected
to his alleged denial of allocution at the time of trial. Thus, any error
is subject to review only for plain error. In this case, the district court
made findings exactly in accordance with the stipulated facts and
guideline factors contained in the plea agreement. Karam was sen-
tenced to the low end of the guidelines. It is hard to discern how
Karam's rights were prejudiced in any way.

VII.

Karam also argues that the district court erred in ordering him to
pay an "indefinite amount of restitution." We reject this argument.
The judgment and commitment order specifically orders Karam to
"pay restitution in the amount of $774,508.00. During supervised

                     14
release, restitution payment of $1,200 per month for 36 months." This
order anticipates full payment of $774,508.00 after the conclusion of
Karam's supervised release.

VIII.

For the foregoing reasons, we affirm the district court's order of
restitution in its entirety.

AFFIRMED

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