                            UNPUBLISHED

                   UNITED STATES COURT OF APPEALS
                       FOR THE FOURTH CIRCUIT


                            No. 06-4354



UNITED STATES OF AMERICA,

                                              Plaintiff - Appellee,

          versus


THOMAS E. COGHILL, JR.,

                                              Defendant - Appellant.



Appeal from the United States District Court for the Western
District of Virginia, at Charlottesville. Norman K. Moon, District
Judge. (3:04-cr-00089-nkm)


Submitted:   October 27, 2006          Decided:     November 15, 2006


Before NIEMEYER and DUNCAN, Circuit Judges, and HAMILTON, Senior
Circuit Judge.


Affirmed by unpublished per curiam opinion.


Curtis S. Fallgatter, FALLGATTER FARMAND & ROELKE, P.A.,
Jacksonville, Florida; Murray J. Janus, BREMMER JANUS COOK &
MARCUS, Richmond, Virginia, for Appellant. John L. Brownlee, United
States Attorney, Jean B. Hudson, Assistant United States Attorney,
Charlottesville, Virginia, for Appellee.


Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:

            Thomas E. Coghill, Jr., pled guilty, pursuant to a plea

agreement, to one count of wire fraud, in violation of 18 U.S.C.

§ 1343 (2000) and one count of bank fraud, in violation of 18

U.S.C. § 1344 (2000).            In the presentence report (PSR), the

probation officer recommended a base offense level of six pursuant

to U.S. Sentencing Guidelines Manual (USSG) § 2F1.1(a) (2000). The

probation officer determined that Coghill’s offense involved at

least     $3,080,520       in   actual    loss   and,      pursuant      to   USSG

§ 2F1.1(b)(1)(N), increased the base offense level by thirteen.

Additionally, pursuant to USSG § 2F1.1(b)(2), because Coghill’s

offense    involved    a    scheme   to   defraud   more    than   one    person,

Coghill’s offense level was increased an additional two levels.

After a three-level adjustment for acceptance of responsibility,

the PSR recommended a total offense level of eighteen.                Coghill’s

prior criminal conduct yielded a criminal history category of I.

The total offense level of eighteen and criminal history category

of I resulted in a sentencing range of twenty-seven to thirty-three

months.

            The district court adopted the recommendations in the

PSR, sentenced Coghill to thirty months in prison, and ordered

restitution in the total amount of $2,909,520.              On appeal, Coghill

raises four issues.        For the reasons that follow, we affirm.




                                     - 2 -
          Coghill first asserts that the district court improperly

included interest as a component of loss, and thus improperly added

thirteen levels to Coghill’s sentence.     This court reviews the

determination of the amount of loss, to the extent it is a factual

matter, for clear error, and reviews de novo the district court’s

legal interpretation of the term “loss” under the Sentencing

Guidelines.   United States v. West, 2 F.3d 66, 71 (4th Cir. 1993).

The relationship of payment of fees, interest and penalties to

principal in calculating loss is a question of law, and is thus

reviewed de novo.

          Valuation of “loss” under USSG § 2F1.1 is discussed in

the commentary to USSG § 2B1.1.   Application note 3(D)(i) to USSG

§ 2B1.1 states that “[l]oss shall not include . . . [i]nterest of

any kind, finance charges, late fees, penalties, amounts based on

an agreed-upon return or rate of return, or other similar costs.”

Coghill cites this language in support of his contention that the

district court’s sentencing decision is erroneous.   Coghill argues

that loss should have been calculated by subtracting all payments

made on his fraudulently obtained loan directly from the amount of

principal borrowed.

          The exclusion of interest from the calculation of loss

under the Guidelines serves to prevent victims from recovering all

interest they could have earned had the fraud never occurred.   See

United States v. Morgan, 376 F.3d 1002, 1014 (9th Cir. 2004).   It


                               - 3 -
does not follow, as Coghill suggests, that payments already made

that both parties understood would be applied in part to interest

due and the remainder to principal ought to instead be applied

solely to principal for purposes of calculating loss.       Rather, the

district   court   properly   calculated   loss   by   determining   the

outstanding principal balance of the loan less the amount the

victims were able to recover through liquidation of the collateral

provided to secure the loan.    See United States v. Abbey, 288 F.3d

515, 518 (2d Cir. 2002).

           Coghill next argues that the district court failed to

restrict loss calculations to the houses on which the fraudulent

loans were obtained.   The district court’s findings at sentencing

as to the amount of loss suffered by a party are findings of fact

reviewed for clear error.      United States v. Daughtrey, 874 F.2d

213, 217-18 (4th Cir. 1989).        The amount of loss should be

calculated based on the value of the loans procured through fraud,

not including outstanding legitimate loans.       See United States v.

Wilson, 980 F.2d 259, 262 (4th Cir. 1992) (limiting amount of loss

under § 2F1.1 in fraudulent loan application case to the amount of

loss related to the false statement, rather than the total loan

amount.)   Our review of the record reveals that the district court

did not clearly err in determining the amount of loss suffered by

each party.   Therefore, Coghill’s argument is without merit.




                                 - 4 -
          Third, Coghill asserts that the district court erred in

failing to subtract $712,040 in alleged losses attributable to

accounting errors.       Again, this is purely a question of fact, and

will be reviewed for clear error.        Daughtrey, 874 F.2d at 217.      The

district court made a proper determination of loss by taking the

total amount of the loan principal associated with the fraud

outstanding   at   the    time   that   the   fraud   was   discovered,   and

subtracting the amount the lenders were able to recover through the

liquidation of collateral.         The court based these figures on the

victims’ testimony, records provided by the victims, and the

presentence report.      Thus, the district court’s determination that

the victims’ records were reliable and correctly established their

loss is not clearly erroneous.

          Finally, Coghill asserts that the district court failed

to comply with mandatory statutory requirements necessary to depart

upward thirteen levels.          This argument is without merit as the

district court did not depart from the Guidelines.              Rather, the

district court merely rejected Coghill’s proposed method of loss

calculation. Because the district court did not depart, it was not

required to state a reason for a departure sentence.

          For the reasons stated herein, we affirm the district

court’s judgment. We dispense with oral argument because the facts

and legal contentions are adequately presented in the materials

before the court and argument would not aid the decisional process.

                                                                   AFFIRMED



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