
USCA1 Opinion

	




          June 21, 1994     UNITED STATES COURT OF APPEALS                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                FOR THE FIRST CIRCUIT                                     ____________          No. 94-1097                                    UNITED STATES,                                      Appellee,                                          v.                                 CHRISTIAN GOODCHILD,                                Defendant, Appellant.                                     ____________                                     ERRATA SHEET               The opinion of this court issued on June 8, 1994, is amended          as follows:               Page 8, line 13:  Add close quote after "device."               Page 25, last line of the second quote:  Change "e" to "be."                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                 ____________________        No. 94-1097                                    UNITED STATES,                                      Appellee,                                          v.                                 CHRISTIAN GOODCHILD,                                Defendant, Appellant.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                          FOR THE DISTRICT OF NEW HAMPSHIRE                   [Hon. Joseph A. DiClerico, U.S. District Judge]                                              ___________________                                 ____________________                                        Before                                 Selya, Circuit Judge,                                        _____________                            Bownes, Senior Circuit Judge,                                    ____________________                              and Boudin, Circuit Judge.                                          _____________                                 ____________________            Vincent J. D'Elia for appellant.            _________________            Jean B. Weld, Assistant United States  Attorney, with whom Paul M.            ____________                                               _______        Gagnon, United States Attorney, was on brief for appellees.        ______                                 ____________________                                     June 8, 1994                                 ____________________                      BOWNES, Senior Circuit Judge.  Defendant-appellant,                      BOWNES, Senior Circuit Judge.                              ____________________            Christian Goodchild, was  indicted on one count of  using two            unauthorized access devices, i.e., two Discover credit  cards                                         ____            issued  on two  separate  accounts, and  obtaining goods  and            services within a one-year  period with a value in  excess of            $1,000, with intent to  defraud, in violation of 18  U.S.C.              1029(a)(2).1                      After  a  jury trial,  defendant was  found guilty.            She was  sentenced to  eleven months incarceration,  a three-            year  term   of  supervised  release,  and   ordered  to  pay            restitution of $10,090.52  to Discover Credit  Card Services,            Inc.  This appeal followed.                      We  consider the  following issues:2   (1)  whether            the government proved each  and every element of 18  U.S.C.              1029(a)(2)  beyond  a  reasonable  doubt;   (2)  whether  the            district  court  erred  in  admitting  certain evidence;  (3)                                            ____________________            1.  18 U.S.C.   1029(a)(2) provides:                      (a) Whoever                       . . .                      (2) knowingly and with intent  to defraud                      traffics   in   or  uses   one   or  more                      unauthorized  access  devices during  any                      one-year  period,  and  by  such  conduct                      obtains  anything  of  value  aggregating                      $1,000 or more during that period;                      shall, if the offense  affects interstate                      or  foreign  commerce,  be   punished  as                      provided  in  subsection   (c)  of   this                      section.                      . . .            2.  Appellant has  eight numbered  issues in her  brief.   We            have consolidated them to five for purposes of our review.                                         -2-                                          2            whether  defendant's  conviction  was  due  in  part  to  the            ineffective   assistance   of   counsel;   (4)   whether  the            prosecutor's conduct  warrants a reversal;  and, (5)  whether            there was error in applying the sentencing guidelines.                             SUFFICIENCY OF THE EVIDENCE                             SUFFICIENCY OF THE EVIDENCE                             ___________________________                      Our standard of review is firmly established:                      We assess the sufficiency of the evidence                      as  a  whole,  including  all  reasonable                      inferences, in the  light most  favorable                      to the verdict, with  a view to whether a                      rational trier  of fact could  have found                      the defendant guilty beyond  a reasonable                      doubt.      We  do   not   weigh  witness                      credibility, but  resolve all credibility                      issues  in  favor of  the  verdict.   The                      evidence may  be entirely circumstantial,                      and  need  not  exclude every  reasonable                      hypothesis  of  innocence,  that is,  the                      factfinder  may  decide among  reasonable                      interpretations of the evidence.            United States v. Batista-Polanco,  927 F.2d 14, 17  (1st Cir.            _____________    _______________            1991)  (citations  omitted).    See  also  United  States  v.                                            ___  ____  ______________            Sepulveda, 15 F.3d 1161, 1173  (1st Cir. 1993); United States            _________                                       _____________            v.  Argencourt, 996  F.2d 1300, 1303  (1st Cir.  1993), cert.                __________                                          _____            denied, _____ U.S. _____, 114 S. Ct. 731 (1994).            ______                      There are four essential  elements of the crime for            which defendant  was convicted:   (1)  that the two  Discover            credit   cards  specified  in  the  indictment  were  "access            devices"  within the meaning of 18 U.S.C.   1029(e); (2) that            defendant used the credit  cards without authorization during            any   one-year  period   and  obtained   anything  of   value            aggregating $1,000 or  more during the time  period; (3) that                                         -3-                                          3            defendant  acted  knowingly, willfully,  and  with  intent to            defraud; and (4) that defendant's actions affected interstate            commerce.   See United States  v. Ryan, 894  F.2d 355, 356-57                        ___ _____________     ____            (10th Cir. 1990).                      We  now  turn to  the  trial  record.   Defendant's            father, Anthony Goodchild, died  in an automobile accident on            September 15, 1988.   In  January of 1988,  Anthony Goodchild            had  applied  for and  received  two  Discover credit  cards,            limited  solely  to his  use.   His  application gave  as his            address  P.O.  Box 398,  Bristol,  New Hampshire.    The 1988            credit cards  expired  in January  1990.   Discover  was  not            notified of Goodchild's death  so it sent him two  new cards,            numbers 2620 and 2471, on  January 8, 1990, to the  same post            office  box  address.    The  re-issue  cards  had  the  same            restriction  as the original ones    the sole  use of Anthony            Goodchild.                      About   two  months   after  her   father's  death,            defendant rented  the same  post office  box  her father  had            rented - box 398.   Defendant notified the  postmistress that            her  mother, Anne, and her  father could receive  mail at the            post  office box.   Defendant's  mother and  father had  been            divorced sometime prior to her father's death.                      At  the time  the  two re-issue  credit cards  were            mailed to post  office box  398, defendant was  the only  one            using  the  box.   On  January  16,  1990,  defendant  called                                         -4-                                          4            Discover, identified herself  and asked  that she  be sent  a            card on  her father's credit account.  No mention was made of            her  father's death.  Discover informed her that it could not            do this unless she forwarded a power of attorney  authorizing            her  use of the credit card accounts.  Defendant proceeded to            make purchases with the cards limited to her father's use.                      Defendant  used card  number 2471  twenty-two times            between January 16 and February 23, 1990, to obtain things or            services  of  value aggregating  $4,847.11.    She used  card            number  2620   thirty-five  times  between   January  15  and            April 10,  1990,  to  obtain  things  or  services  of  value            aggregating $7,137.43.   Defendant  made two minimum  monthly            payments  on card number 2620,  $91.00 on March  3, 1990, and            $104.00 on March 19, 1990.   These were the only payments she            made on either of the cards.                      On  February 5,  1990, Discover  security personnel            started an  investigation  of the  use  of card  number  2471            because of  transactions exceeding  the charge limit.   After            receiving  no answer at the  phone number it  had for Anthony            Goodchild, Discover deactivated  the card.  On February  6 an            attempted use  of the  card at  Nutri-System in  Laconia, New            Hampshire, was blocked.                      The  card account was  then assigned  to Discover's            collections  department.    It  attempted  to  locate Anthony            Goodchild.  The  phone listed on his credit card application,                                         -5-                                          5            603-744-6591,  was  called on  April  23, 1990,  and  a woman            informed the caller that Anthony Goodchild no longer lived at            that  address.  It learned from Anthony's former boss that he            had died "three  to four years  ago."  Discover, on  July 19,            1990,  again called the number it had called previously.  The            caller was told by the same woman  who had answered the phone            on April  23, that she had  had the phone number  for a year,            that she did not know Anthony Goodchild, and that a Goodchild            lived in Alexandria, New Hampshire.                      Discover found a telephone number for defendant  in            Alexandria,  New  Hampshire, 603-744-0157.    The number  was            called on July 19, 1990, and a message left  on the answering            machine asking that  the call  be returned.   A woman  called            back.  After identifying  herself as Christian Goodchild, she            said a number  of things.   She told the Discover  agent that            Anthony  Goodchild  had died  in  an  automobile accident  on            September 15, 1988, in Reading, Pennsylvania.   She said that            there  was a "long story behind the account sales" in January            and February, 1990.  She went on to say that her parents were            divorced four months before her father's death and that after            he died "girlfriends  started popping up" and  her mother was            heartbroken.  She  told Discover that  the attorney had  paid            off "all credit accounts" through the estate, that the estate            was  closed, and because she had  fired the attorney handling            the  estate  for  incompetence,  there  was  no  attorney  to                                         -6-                                          6            contact.  Defendant also volunteered that her father's latest            girlfriend, who was living with him at the time of his death,            was  "Arline," last  name  and present  whereabouts  unknown.            After this phone call, the credit card accounts were referred            to the  fraud unit  of Discover,  and eventually  were turned            over to United States Postal Inspectors.                      There was independent evidence linking defendant to            the credit  card transactions.  An  insurance adjuster, Terry            Seger,  went  to  defendant's  home  on  June  14,  1991,  to            investigate  her  burglary  claim  of  a loss  in  excess  of            $70,000.   Seger told defendant that  he needed corroborating            information  of the  value of  the items  stolen.   Defendant            submitted specific Discover card records of purchases on both            cards totalling approximately $3,362.12.   The records showed            that these purchases were made in 1990.  Defendant told Seger            that she had  lived in her father's house since a month after            her father's death  in 1988.   She also  told Seger that  she            owned the Discover credit cards jointly with her father.                      Evidence  was introduced showing that defendant was            a  regular customer  of Nutri-System  Weight Loss  Centers in            Concord, New  Hampshire, in 1990.   Purchases were  made from            Nutri-System on card number 2620 on February 12, February 26,            and March  3, 1990, and  one purchase on card  number 2471 on            February 1, 1990.                                         -7-                                          7                      Based  on our  review  of the  record, focussed  as            prescribed in  the light  most favorable to  the verdict,  we            find that  the prosecution  proved all  four elements  of the            crime charged beyond  a reasonable  doubt.  There  can be  no            doubt that  the Discover  credit cards were  "access devices"            within  the meaning  of  the statute  and  defendant did  not            challenge  the judge's charge to  this effect.3   Nor can any            serious  challenge be made to the evidence showing use of the            credit  cards by defendant.  And it is clear that defendant's            use of the  credit cards affected  interstate commerce.   The            one  issue that  requires further  discussion is  whether the            government has proven intent to defraud.            Intent to Defraud            Intent to Defraud            _________________                      Under 18  U.S.C.    1029(a)(3) the  government must            prove that a defendant "knowingly and with intent  to defraud            traffics in or  uses one or more unauthorized access devices"            . . .  ."   Section  1029(e)(3) defines  "unauthorized access            device as follows:                                            ____________________            3.  18  U.S.C.      1029(e)(1)  defines  "access  device"  as            follows:                         the  term  "access  device" means  any                      card,  plate,  code,  account number,  or                      other means of account access that can be                      used,  alone  or   in  conjunction   with                      another access device,  to obtain  money,                      goods,  services, or  any other  thing of                      value, or that can  be used to initiate a                      transfer of funds (other than  a transfer                      originated solely by paper instrument);                                         -8-                                          8                         the term  "unauthorized access device"                      means  any access  device  that is  lost,                      stolen,  expired,  revoked, canceled,  or                               _______                      obtained with intent to defraud;              (Emphasis added.)                      The district court charged the jury as follows:                         The third element that  the Government                      must prove  beyond a reasonable  doubt is                      that  the  defendant acted  knowingly and                      with intent to defraud.                         The  Government  must  prove beyond  a                      reasonable doubt:                         (1) that  Christian Goodchild obtained                      the   Discover   cards  with   intent  to                      defraud,  or that  the credit  cards were                      lost,   stolen,   expired,   revoked   or                      canceled; and                         (2)    that  she  knowingly  and  with                      intent to defraud used the credit cards.                                        ____            (Emphasis added.)                      The  court  also gave,  at  defendant's  request, a            "good faith" instruction:                         Since  an  essential  element  of  the                      crime  charged is intent to defraud, good                      faith  on the  part of  a defendant  is a                      complete  defense to  a charge  of credit                      card  fraud.   If the  defendant actually                      believed  in  good  faith  that  she  was                      acting properly, even if she was mistaken                      in that  belief, and even  if others were                      injured by her conduct, there would be no                      crime.   An  honest mistake  in  judgment                      does not rise  to the  level of  criminal                      conduct.   A  defendant does  not  act in                      good  faith if, even  though she honestly                      holds a certain  opinion or belief,  that                      defendant also acted  with the purpose of                      deceiving others.                                         -9-                                          9                         While  the  term  good  faith  has  no                      precise definition, it means  among other                      things a belief or opinion honestly held,                      an absence of malice  or ill will, and an                      intention   to    avoid   taking   unfair                      advantage of another.                         The  burden is  on  the Government  to                      prove  fraudulent  intent and  consequent                      lack  of good  faith beyond  a reasonable                      doubt.     The  defendant  is   under  no                      obligation to prove good faith.            It  is clear  that  the jury  was  properly and  evenhandedly            instructed on intent to defraud.                      Fraud is usually proven by circumstantial evidence.            Direct proof  of a  knowing intent to  defraud is rare.   See                                                                      ___            United States  v. Nivica,  887 F.2d  1110, 1113-15 (1st  Cir.            _____________     ______            1989),  cert. denied, 494  U.S. 1005 (1990).   As we  said in                    _____ ______            Nivica:  "There  is no  pat formula for  such proof;  factual            ______            circumstances may signal fraudulent intent in ways as diverse            as the manifestations of fraud itself."  Id. at 1113.                                                     ___                      We now  examine the evidence.   Defendant points to            the following  evidence and  the reasonable inferences  to be            drawn therefrom  as establishing  that she  had no  intent to            defraud  Discover.   She  took out  the  post office  box two            months  after her father's death  in September 1988, in order            to  help the estate receive  mail, for her  personal use, and            the use of  her mother.  Defendant  points out that in  using            the credit cards  she signed her surname as  she did on other            credit  cards held by her.  She  also asserts that she always            disclosed her proper name, address, phone number and driver's                                         -10-                                          10            license number.  She  emphasizes that she never  denied using            the credit cards, and that she did make payments on the cards            from  her own checking account.   She states  that she always            paid bills late.   We have  been unable to find  any evidence            about defendant paying bills late, but will assume that there            is evidence to  that effect  or that it  could be  reasonably            inferred  from other  evidence.    Defendant emphasizes  that            during  the  time of  the credit  card  charges she  had been            appointed personal representative of her father's estate with            the consent of her  mother and two brothers and  that all the            expenditures  were made  with  the approval  of the  attorney            representing the estate.  Defendant  also points out that she            was financially able to pay the credit card bills.                      We  start  our  examination  of   the  government's            evidence on  intent to defraud  with the telephone  call from            defendant  to  Discover on  January  16, 1990,  in  which she            requested, without mentioning her father's death, that she be            sent a card on her father's credit accounts and was told that            in  order  to do  so Discover  required  a power  of attorney            authorizing  her  to  use   the  accounts.    Defendant  then            proceeded to use both  cards, which were limited to  her late            father's use, for credit purchases totalling $11,984.54.  The            only payments made  on the accounts were  two minimum monthly            payments of $91.00 and $104.00 on card number 2620.  Although            she was administrator  of her father's estate during the time                                         -11-                                          11            she was  using the  cards, defendant never  notified Discover            until  mid-July of 1990 that  her father had  been dead since            September  15,  1988.     When  the  insurance  adjuster  was            investigating defendant's  claim of  a burglary of  her home,            she specified  Discover credit  card purchases of  items that            she claimed had been stolen.  She told the insurance adjuster            that she held the  cards jointly with  her father.  This  was            false and defendant knew it was false.  There can be no doubt            that defendant had the  wherewithal to pay Discover what  was            owed.    By  the  spring  of  1990,  defendant  had  received            distributions  from  her  father's  estate  of  approximately            $22,855.    By the  time  of  her indictment,  defendant  had            received $181,607 in estate distributions.4                      We conclude that there  was sufficient evidence for            a jury to find  beyond a reasonable doubt that  defendant had            obtained  the  credit cards  after  they had  expired  on her            father's  death,  that  she  used them  for  her  own benefit            knowingly and with intent  to defraud, and obtained something            of  value  aggregating more  than  $1,000  during a  one-year            period.  Or to put it another way,  the government proved all            the elements of the crime charged beyond a reasonable doubt.                              THE ADMISSION OF EVIDENCE                              THE ADMISSION OF EVIDENCE                              _________________________                                            ____________________            4.  We can  only wonder why defendant  needed court appointed            counsel.                                         -12-                                          12                      Defendant   hotly  contested,  on  the  grounds  of            hearsay, the  admission  of "collection  memos"  of  Discover            which contained  the histories  of the  two accounts  used by            her.  The memos incorporated the substance of telephone calls            purportedly  made by  defendant to  Discover.   The basis  of            defendant's hearsay  objection to the memos  was that neither            the person(s) who  prepared the memo(s) nor the person(s) who            had  the  telephone  conversation(s)  or  the  person(s)  who            maintained the  records testified.   The memos  were admitted            under the business record exception to the hearsay rule, Fed.            R.  Evid. 803(6).  The telephone statements allegedly made by            defendant  on  July  19,  1990,  were  also  admitted  as  an            admission  under  Fed.  R.   Evid.  801(d)(2).    A  detailed            exposition of the presentation of this evidence is necessary.                      Glen  Hall,  manager  of fraud  investigations  for            Discover, testified as follows.  The fraud investigation unit            often  initiated investigations  based on  referrals received            from the  collections department.   Each referral  contains a            record of what  the collections  department has  done on  the            account  up to the  date of the  referral to  the fraud unit.            This information  includes any  contacts with  and statements            made  by  the  cardholder.    A  referral  also  contains any            documentation  on  hand,  including  sales  drafts, with  the            customer's signature on them.                                         -13-                                          13                      The main activity by the  collections department on            a delinquent  account consists  of telephone calls  to locate            the  cardholder.   It is  standard procedure  for collections            personnel to log  everything done.   This is called  "memoing            the  account."   All phone  calls have  to be "memoed."   The            collections department  uses its own shorthand  system in the            memo record.  Hall  testified that he was familiar  with most            of  the shorthand system used.  All  of the account memos are            put  into a computer.   Each account memo  can be printed out            when  needed.   Exhibits  12a, 12b,  12c,  13a, and  13b were            computer  printouts  of  "collection  memos"   pertaining  to            defendant's accounts.  Hall  explained how the printouts were            read  and the meaning of the shorthand terms and symbols used            in  them.   Hall testified  that the  printout exhibits  were            brought with  him in response  to a  subpoena for  Discover's            collections file.   He also testified that these records were            kept  in  the  ordinary  course  of  business and  stored  on            Discover's computer.                      Defendant's hearsay attack focuses on the admission            of  exhibits 12b and  13b.  These  computerized memos include            references  to  telephone  contacts   with  a  woman  at  the            telephone number listed  on Anthony  Goodchild's credit  card            application.  This woman referred the collections caller to a            person by  the name of  Goodchild living  in Alexandria,  New            Hampshire.   As a  result,  collections obtained  defendant's                                         -14-                                          14            phone number and  left a  message on  her answering  service.            Defendant objected to the introduction of this evidence.  The            district court  properly admitted the statement  of the woman            that  a person  by  the  name  of  Goodchild  was  living  in            Alexandria, not for the  truth of the statement made,  but to            explain what Discover did in response to it.                         It  is not  the case  that all  out of                      court  statements   are  inadmissible  as                      hearsay.   The Federal  Rules of Evidence                      make  it quite clear that such statements                      are inadmissible only  if offered for the                      truth  of the  matter therein.   Fed.  R.                      Evid. 801(c).  We agree with the district                      court's    decision     permitting    the                      introduction  of  the  documents, on  the                      ground that they  were admitted, not  for                      proving the truth  of their contents, but                      to   prove  what  steps   were  taken  to                      investigate the circumstances surrounding                      the assault.            Morgan v. Massachusetts General  Hospital, 901 F.2d 186, 190-            ______    _______________________________            91 (1st Cir. 1990).   This ruling applies with  full vigor to            the telephone statements made by the unidentified woman.                      Defendant concentrates most  of her objection  fire            on telephone  statements allegedly  made by  her on  July 19,            1990,  in response  to  Discover's request  on her  answering            service  that she  call.   The  statements  were:   that  she            identified  herself  as  Christian  Goodchild;  that  Anthony            Goodchild had died in an automobile accident on September 15,            1988; that her parents were divorced four months prior to her            father's  death;  that  after her  father  died  "girlfriends            started popping up" and her  mother was heartbroken; that the                                         -15-                                          15            attorney paid  off all "credit accounts"  through the estate;            that  she had fired the attorney for incompetence in handling            the estate and  the estate was closed; that her  father had a            girlfriend living with  him at the  time of his death  by the            name of "Arline," last name and present whereabouts unknown.                      The core issue is whether the computer printouts of            the   collection  memos   containing  records   of  telephone            statements  made  to  Discover's  collection  personnel  were            properly admitted under the  business record exception to the            hearsay rule.  Fed.                                          -16-                                          16            R. Evid. 803(6) provides:                         (6)    Records of  regularly conducted                         (6)    Records of  regularly conducted                      activity.  A memorandum,  report, record,                      activity.                      or  data  compilation,  in any  form,  of                      acts,  events,  conditions, opinions,  or                      diagnoses, made at  or near the  time by,                      or  from  information  transmitted by,  a                      person with  knowledge,  if kept  in  the                      course of a regularly  conducted business                      activity,  and  if  it  was  the  regular                      practice  of  that  business activity  to                      make the memorandum,  report, record,  or                      data  compilation, all  as  shown by  the                      testimony  of  the  custodian   or  other                      qualified witness, unless  the source  of                      information    or     the    method    or                      circumstances  of   preparation  indicate                      lack  of  trustworthiness.     The   term                      "business"  as  used  in  this  paragraph                      includes      business,      institution,                      association, profession, occupation,  and                      calling  of every  kind,  whether or  not                      conducted for profit.                      We find that the telephone statement memos meet the            strictures  of the rule.   They were reports  or records made            either  during  the  telephone  conversations  or immediately            following them.   They were made and kept in  the course of a            regularly  conducted  business  activity,   i.e.,  telephonic                                                        ____            investigations of  delinquent credit  card accounts.   And it            was the regular practice of Discover to make a record of such            telephone calls.                      Although Hall  did not make the  records himself or            participate in the telephone conversations, we think he was a            witness qualified to explain  the memos.  He was  the manager            of the  fraud  unit  of  Discover  and  understood  both  the            procedure followed by collections in investigating delinquent                                         -17-                                          17            accounts  and  the  records  required  to  be  kept  of  such            investigations.   There  was no  evidence indicating  lack of            trustworthiness  of  the source  of  the  information or  the            circumstances of preparation.                      In rendering our ruling we are, of course, aware                      that   the   usual  array   of  threshold                      questions pertaining to the admissibility                      of business records come within the ambit                      of   the  district   court's  discretion.                      These usual questions include, of course,                      questions   as   to   whether  a   proper                      foundation was laid or whether sufficient                      indicia of trustworthiness were shown.            United States v. McGill, 953 F.2d 10, 13 (1st Cir. 1992).            _____________    ______                      We are not  persuaded by defendant's argument  that            the  memos  were  not  business  records,  but  prepared  for            litigation.     Records  prepared  by   a  debt   collections            department  are primarily  made to  enable the  department to            track down debtors and  collect money owed.  This  is not the            kind  of record condemned in Palmer v. Hoffman, 318 U.S. 109,                                         ______    _______            113-14 (1943) which was a statement made by the engineer of a            train  involved  in an  accident.   The  record here  was not            prepared with  an  eye  to  litigation; its  purpose  was  to            facilitate the collection  of debts owed Discover.  The Tenth            Circuit, in an analogous case, held:                      The government established at  trial that                      the notes were  contemporaneous with  the                      [telephone]  conversation,  were part  of                      the   regular   course   of    the   loan                      counselors'   business,   and   otherwise                      qualified as a business record under Rule                      803(6).    Therefore, the  district court                                         -18-                                          18                      did  not abuse  its discretion  in ruling                      that the notes qualify as an exception to                      the hearsay rule.            United  States v.  Kingston,  971 F.2d  481,  486 (10th  Cir.            ______________     ________            1992).                      We find  the telephone statements of defendant made            on July  19 to Discover  were admissible  under the  business            record rule.                        The  district  court  also  admitted  as admissions            under  Fed.  R. Evid.  801(d)(2)(A)5  the  July 19  telephone            statements made by defendant to Discover.  We  recognize,  of            course,  that normally statements by  one not a  party to the            business  are not  admissible  for the  truth  of the  matter            stated unless some exception  other than the business records            exception is involved; the  business records exception merely            avoids having to call the person in the business who  had the            telephone conversation  but  does not  justify admitting  the            statements  of the outsider for  their truth.   In this case,            the predicate  for making the statements relevant is that the            jury could reasonably find  that the statements were  made by            the defendant.   The evidence  was that she  returned a  call                                            ____________________            5.  Fed. R. Evid. 801 (d)(2)(A) states:                      (d) Statements which are  not hearsay.  A                      (d) Statements which are  not hearsay.                      statement is not hearsay if                          (2) Admission by party-opponent.   The                         (2) Admission by party-opponent.                      statement  is offered against a party and                      is  (A)  the  party's  own  statement  in                      either an individual or  a representative                      capacity . . . .                                         -19-                                          19            made to her  number and  identified herself.   She then  made            statements about Anthony Goodchild and his wife that only one            privy  to the family history would know.  The statements were            admissions because  they could be used  to identify defendant            and were properly admitted as such.  Moreover, the judge gave            a cautionary  instruction after  the phone-call  evidence was            admitted:                         Members of the jury, during the course                      of  this  witness's  testimony  you  have                      heard  certain testimony  about notations                      or memos made in  the business records of                      Discover    concerning    certain   phone                      conversations.  Before you  can attribute                      any  of  those  recorded  remarks  to the                      defendant, Ms. Goodchild,  in this  case,                      you  must be  satisfied from  all  of the                      evidence  before  you that  the defendant                      was  in fact  the person  who was  on the                      other  end  of  the  telephone  line  and                      making those remarks.                         If  you  are  not satisfied  from  the                      evidence   that   the   caller  was   the                      defendant,  then  you must  not attribute                      any of those remarks to her.            This  cautionary  instruction  was  clear and  correct.    It            advised  the  jury how  the  phone  call evidence  should  be            approached.                          INEFFECTIVE ASSISTANCE OF COUNSEL                          INEFFECTIVE ASSISTANCE OF COUNSEL                          _________________________________                      Defendant  mounts a  lengthy and  detailed argument            that trial  counsel's poor performance resulted,  at least in            part, in defendant's  conviction.  We  follow our usual  rule            and refuse  to address the ineffective  assistance of counsel            issue  in the first  instance.  In  United States  v. Mala, 7                                                _____________     ____                                         -20-                                          20            F.3d 1058 (1st Cir.  1993) we explained in detail  the reason            for the rule:                         We   have   held  with   a  regularity                      bordering  on  the monotonous  that fact-                      specific claims of ineffective assistance                      cannot make their  debut on direct review                      of  criminal  convictions,  but,  rather,                      must  originally  be  presented  to,  and                      acted  upon by,  the trial  court.   See,                                                           ___                      e.g.,  United States v.  McGill, 952 F.2d                      ____   _____________     ______                      16, 19 (1st Cir.  1992); United States v.                                               _____________                      Natanel,  938  F.2d  302, 309  (1st  Cir.                      _______                      1991), cert. denied, ____ U.S.  ____, 112                             _____ ______                      S.Ct. 986, 117 L.Ed.2d 148 (1992); United                                                         ______                      States  v. Hunnewell,  891 F.2d  955, 956                      ______     _________                      (1st Cir. 1989); United States  v. Costa,                                       _____________     _____                      890  F.2d  480, 482-83  (1st  Cir. 1989);                      United States v.  Hoyos-Medina, 878  F.2d                      _____________     ____________                      21,  22 (1st Cir. 1989); United States v.                                               _____________                      Carter,  815  F.2d  827,  829  (1st  Cir.                      ______                      1987);  United  States  v. Kobrosky,  711                              ______________     ________                      F.2d 449, 457 (1st  Cir. 1983).  The rule                      has a prudential aspect.  Since claims of                      ineffective  assistance involve  a binary                      analysis the defendant  must show, first,                      that     counsel's     performance    was                      constitutionally  deficient and,  second,                      that the deficient performance prejudiced                      the    defense,    see   Strickland    v.                                         ___   __________                      Washington, 466 U.S.  668, 687, 104 S.Ct.                      __________                      2052,  2064,  80 L.Ed.2d  674 (1984) such                      claims  typically require  the resolution                      of    factual    issues    that    cannot                      efficaciously be addressed  in the  first                      instance by an  appellate tribunal.   See                                                            ___                      Costa, 890 F.2d at 483; Hoyos-Medina, 878                      _____                   ____________                      F.2d  at  22.   In  addition,  the  trial                      judge,  by reason of his familiarity with                      the case, is usually in the best position                      to assess both  the quality of  the legal                      representation afforded  to the defendant                      in the district court  and the impact  of                      any  shortfall  in  that  representation.                      Under ideal circumstances,  the court  of                      appeals should  have the benefit  of this                      evaluation;   elsewise,  the   court,  in                      effect, may be playing blindman's buff.                                         -21-                                          21            Id.  at 1063 (footnote omitted).   See also  United States v.            ___                                ___ ____  _____________            Daniels, 3 F.3d 25 (1st Cir. 1993).            _______                                PROSECUTORIAL CONDUCT                                PROSECUTORIAL CONDUCT                                _____________________                      Defendant  charges  that  the "prosecutor's  unduly            prejudicial  and overreaching actions  constitute plain error            and warrant a  reversal of  the action."   We  have read  the            record carefully and  have found no actions by the prosecutor            that  even suggest conduct  requiring reversal.   It  is true            that the  prosecutor pushed  hard during  the  trial for  the            admission of evidence  and to sustain  his objections and  he            was somewhat  highhanded at times.   But this is part  of the            adversarial system.   There was no conduct  by the prosecutor            that  was  unethical, unfair,  or  which  infringed upon  the            constitutional rights of defendant.                      We  are,  however,  bothered  by   a  statement  in            defendant's  brief that is without support in the record.  On            page  32   of  defendant's  brief  there   is  the  following            statement:                        In  addition,  during the  prosecutor's                      closing  his  repeated  use of  the  term                      "uncontradicted testimony" drew attention                      to the  fact that Ms.  Goodchild did  not                      testify.  Such references are grounds for                      reversal.            We  agree that  such a  reference might  well be  grounds for            reversal  and a new trial.  But the prosecutor's argument did            not  contain  a  single   use  of  the  term  "uncontradicted            testimony,"  let  alone  repeated  use  of  it.    We  expect                                         -22-                                          22            appellate  counsel to  read  the trial  record and  represent            accurately  in  the  brief  and  at  oral  argument  what  is            contained  therein.  Counsel should be aware that we read the            record, as well as the briefs, carefully.                                    THE SENTENCING                                    THE SENTENCING                                    ______________                      We are  somewhat hampered  in our  consideration of            this issue because  neither party ordered a transcript of the            sentencing hearing in this  case.  We proceed on the basis of            the presentence  report and  the judgment which  includes the            court's  statement of  reasons for  the sentence.   Defendant            received the following sentence:  she was committed to prison            for eleven months; she received  a supervised release term of            three  years; and  she  was  ordered  to pay  restitution  to            Discover in the amount of $10,090.52.                      Her sentence  was arrived at as  follows.  Pursuant            to    2F1.1 of the Guidelines the base offense level (B.O.L.)            for a  violation of 18 U.S.C.   1029(a)(2) is six.  The court            found  that the  amount  of Discover's  loss was  $10,090.52.            This  increased  the B.O.L.  by  three levels.    Because the            offense  involved more  than  minimal  planning, the  offense            level  was enhanced two more levels.  No other adjustments to            the  B.O.L.  were made.    The  defendant's criminal  history            category  was  I.   The imprisonment  range  for a  B.O.L. of            eleven  and  a criminal  history category  of  I is  eight to            fourteen months.                                         -23-                                          23                      Defendant's main challenge to the  sentence was the            court's determination  that  the victim's  loss  amounted  to            $10,090.52.  She argues that the loss was $9,160.27.  If this            were  the   loss,  under   the  applicable  section   of  the            Guidelines,  the imprisonment  range would  be six  to twelve            months.                      The presentence report shows  the amount of loss as            $9,160.27.    The  district  court  rejected  this.   In  its            statement of reasons it said:                         The government  objected to paragraphs                      10 and 11 of  the addendum on the grounds                      that   in   calculating   the   loss   to                      Discovery, [sic] late and finance charges                      should be  included.  If such charges are                      included, the loss  figure is  $10,090.52                      rather  than  $9,160.27 as  determined in                      the report.  The latter figure results in                      an  increase  of  two  rather  than three                      levels  to the  base offense level.   The                      court  concluded  that  during the  trial                      Glen Hall, a representative of Discovery,                      [sic]   testified   that   the  loss   to                      Discovery [sic] was  $10,090.52 and  that                      figure  was  not  challenged  during  the                      course  of the  trial.    Therefore,  the                      court established the  lost [sic]  figure                      as $10,090.52  which  will result  in  an                      increase  in three  levels  to  the  base                      offense level  rather than two  levels as                      indicated in paragraph 21 of  the report.                      Paragraph  21 is  amended  to  reflect  a                      three level increase.                      Our  standard  of review  follows  two intersecting            standards.   Valuation of  loss is  reviewed under  the clear            error  standard.  United States v. Brandon, 17 F.3d 409, 456-                              _____________    _______            57 (1st  Cir. 1994).   But  when "an  appeal raises  a purely                                         -24-                                          24            legal  question  involving the  proper interpretation  of the            sentencing guidelines, appellate review is plenary."   United                                                                   ______            States v. DeLuca, 17 F.3d 6, 7 (1st Cir. 1994).              ______    ______                      The   issue   of  "loss"   valuation   requires  an            interpretation of Commentary  7 to   2F1.1  of the Guidelines            which states in pertinent part:                         7.  Valuation of  loss is discussed in                      the   Commentary   to   2B1.1   (Larceny,                      Embezzlement, and Other Forms  of Theft).                      As in  theft cases, loss is  the value of                      the   money,    property,   or   services                      unlawfully  taken;  it   does  not,   for                                          _____________________                      example,  include   interest  the  victim                      _________________________________________                      could have  earned on such funds  had the                      _________________________________________                      offense not occurred.                        ____________________            (Emphasis  ours.)  The question  is whether, in  light of the            interest preclusion statement in the commentary, the district            court erred in including finance charges and late fees in its            valuation of  the loss.6  There can  be little doubt that the            courts must  follow the Guidelines commentaries.   Stinson v.                                                               _______            United States, ____ U.S. ____, 113 S.Ct. 1913, 1919 (1993).            _____________                                            ____________________            6.  Although the  court did  not state explicitly  that these            charges  were included such can be  inferred from its comment            in its statement  of reasons that the government  objected to            the   presentence  report's  recommendation  of  a  two-level            increase because such recommendation failed to include  "late            and finance" charges.  See also Government's Brief at page 41                                   ___ ____            in which it is stated:                         The court accepted as  accurate Hall's                      figures,  which   included  only  finance                      charges and late fees  as of the dates of                      the termination of the accounts  in 1990,                      . . . .                                         -25-                                          25                      We  are  not the  first court  to grapple  with the            scope   and  application  of   the  "interest"  statement  in            Commentary 7.   In United  States v. Henderson,  No. 92-2707,                               ______________    _________            1994 U.S. App.  LEXIS 7166 at  *33 (5th Cir. April  13, 1994)            (footnote omitted) the court held:                      The current commentary to  the Sentencing                      Guidelines  provides  that the  amount of                      loss  "does  not,  for  example,  include                      interest the victim  could have earned on                      the funds had the offense  not occurred."                      U.S.S.G.     2F1.1, comment.  (n.7).   We                      find  that  this  commentary  sweeps  too                      broadly  and,  if  applied  in  this case                      would be inconsistent with the purpose of                        2F1.1.   Stinson v. United  States, 123                                 _______    ______________                      L.  Ed. 2d  598,  113 S.  Ct. 1913,  1919                      (1993).   Interest should be included if,                      as  here,  the  victim had  a  reasonable                      expectation  of  receiving interest  from                      the  transaction.    See,   e.g.,  United                                           ___    ____   ______                      States v.  Lowder, 5 F.3d  467, 471 (10th                      ______     ______                      Cir. 1993) (holding that  interest should                      be included in  the amount of  loss where                      the defendant promised victims a specific                      interest  rate   on  their  investments);                      United  States  v. Jones,  933  F.2d 353,                      ______________     _____                      354-55 (6th Cir.  1991) (interest  should                      be included where the defendant defrauded                      credit   card   companies  which   had  a                      reasonable  expectation   of  a  specific                      return on the  credit extended).  In  the                      words of the district judge, "interest is                      a loss,  a  loss of  earnings on  money--                      representing a loss of earnings  on money                      that was--that rightfully belonged to the                      bank   and   therefore  should   be  also                      included."   11  R.  42-43.   We find  no                      error in the district court's decision to                      include interest in the amount of loss in                      this case.            In United States v. Lowder,  5 F.3d 467 (10th Cir.  1993) the               _____________    ______            court reasoned:                                         -26-                                          26                      We interpret the guideline as disallowing                      "opportunity cost" interest, or the time-                      value  of  money  stolen   from  victims.                      Here,  however,  Defendant defrauded  his                      victims  by  promising them  a guaranteed                      interest rate  of 12%.  He  induced their                      investment by essentially contracting for                      a specific rate of  return.  He also sent                      out   account   summaries,  showing   the                      interest  accrued  on  their  investment.                      This is analogous to  a promise to pay on                      a bank loan or promissory note, in  which                      case  interest may  be  included  in  the                      loss.            Id. at 471.            ___                      In a  case like this one,  involving the fraudulent            use of unauthorized credit cards, the Sixth Circuit, in a per                                                                      ___            curiam opinion held:            ______                      We  do not  think  it was  error for  the                      district  court  to include  the interest                      charges in  the calculation of  the loss.                      When  Ms. Jones  made her  purchases with                      the  fraudulently obtained  credit cards,                      the issuer advanced money to the retailer                      on her behalf.   When Ms. Jones failed to                      pay, the issuer lost the use of the money                      that  ought  to  have come  back  to  it.                      Money has a time value, as all  borrowers                      and lenders  know, and the time  value of                      the money withheld by Ms. Jones was fixed                      by the credit card agreements under which                      the interest was calculated.            United States v. Jones, 933 F.2d 353, 354 (6th Cir. 1991).            _____________    _____                      This is a close issue  and we must acknowledge that            there  is to some degree  a conflict between  the cited cases            and the language of the Commentary.  The conflict is due to a            clash between  the ambiguous language used  in the Commentary            and  the complexity of what  constitutes "interest" and  when                                         -27-                                          27            it  is an integral part of  the value of the "money, property            or  services unlawfully taken."   Commentary 7.   Our holding            will not  solve the  problem; such  resolution lies  with the            Sentencing Commission.                      We hold that in a case involving the fraudulent use            of unauthorized  credit cards, finance charges  and late fees            do  not  come within  the  meaning of  the  Commentary phrase            "interest  the victim could have earned on such funds had the            offense not  occurred".   This phrase,  we  think, refers  to            opportunity cost interest.  In a credit card case there is an            agreement  between  the company  and  the  cardholder to  the            effect  that when payments are made  late, or not at all, the            cardholder is subject to late fees and finance charges.  This            is part  of the price of using credit cards.  The credit card            company has a right to expect that such fees and charges will            be paid.   This is not "interest  that the victim  could have            earned on  such funds had the offense not occurred."  It is a            contractual obligation  on  which  the  credit  card  company            relies each time it extends credit to a cardholder.  In fact,            but for the cardholder's promise to pay late fees and finance            charges, the credit card company  would not extend its credit            in the first instance.  Such charges, therefore, are properly            included in the loss valuation.                      The judgment  of the district court  is affirmed in                      The judgment  of the district court  is affirmed in                      ___________________________________________________            all respects.            all respects.            _____________                                         -28-                                          28
