March 29, 1993    UNITED STATES COURT OF APPEALS
                    FOR THE FIRST CIRCUIT
                                         

No. 92-2025

                  UNITED STATES OF AMERICA,

                          Appellee,

                              v.

                       PETER J. REGAN,

                    Defendant, Appellant.

                                         

         APPEAL FROM THE UNITED STATES DISTRICT COURT

              FOR THE DISTRICT OF MASSACHUSETTS

         [Hon. A. David Mazzone, U.S. District Judge]
                                                    

                                         

                            Before

                    Boudin, Circuit Judge,
                                         

                Aldrich, Senior Circuit Judge,
                                             

                  and Stahl, Circuit Judge.
                                          

                                         

George F.  Gormley with  whom John  D.  Colucci was  on brief  for
                                               
appellant.
Ralph F.  Boyd, Jr., Assistant  United States  Attorney, with whom
                   
Robert  J.  Lynn,  Assistant  United  States  Attorney,  and  A.  John
                                                                  
Pappalardo, United States Attorney, were on brief for appellee.
      

                                         

                        March 29, 1993
                                         

          ALDRICH, Senior Circuit Judge.   Defendant Peter J.
                                       

Regan,  who pled guilty to 55 counts of bank embezzlement (18

U.S.C.   656)  on February 18,  1992 with no  reservations or

conditions  now relevant,  appeals with  respect to  his U.S.

Sentencing Guidelines  sentence of 40 months,  (a) because he

was not allowed a  hearing on oral testimony with  respect to

his claimed deduction on  account of diminished capacity; (b)

because he  was sentenced under guidelines  issued later than

the dates of some of his actions, and  (c) because there were

enhancements  made  for  abuse of  trust  and  for more  than

minimum planning.  We affirm.

          Defendant,  during   the  period  covered   by  the

indictment, viz.,  November, 1987  to  July 16,  1991, was  a

senior vice president in charge  of the Special Loan Services

Division  of  the Shawmut  National Bank.    As head  of this

division,  defendant directly  supervised and  controlled the

collection  and   "work-out"   of  delinquent   and   problem

commercial loans.   Because of the individuality of this work

and   defendant's   seniority,    he   was    extraordinarily

unsupervised,  all the way from his actions in causing debits

or credits to Shawmut's cash  collateral account, down to his

maintaining personal custody of the files.  During the period

in  question he exercised this freedom in a number of manners

so as to embezzle some $2,500,000 from the Bank.  On July 16,

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1991, by reason of a conspicuous act, he was  discovered.  He

was promptly indicted and, in due course, pleaded guilty.

                     Diminished Capacity
                                        

          Defendant  first  challenges  the district  court's

refusal to hold an evidentiary hearing on his  entitlement to

a   downward  departure   for  diminished   mental  capacity.

Sentencing Guidelines   5K2.13 provides as follows:

            5K2.13.    Diminished Capacity  (Policy
                                          
          Statement)

          If the defendant committed  a non-violent
          offense     while      suffering     from
          significantly reduced mental capacity not
          resulting from voluntary  use of drugs or
          other intoxicants, a  lower sentence  may
          be  warranted  to reflect  the  extent to
          which reduced mental capacity contributed
          to   the   commission  of   the  offense,
          provided  that  the defendant's  criminal
          history  does  not  indicate a  need  for
          incarceration to protect the public.

The  burden of  proving causation  is on  the defendant,  and

there can be no appeal from the district court's  denial of a

reduction.  United States  v. Lauzon, 938 F.2d 326,  331 (1st
                                    

Cir.),  cert. denied, 112 S.Ct. 450  (1991); United States v.
                                                          

Shattuck, 961 F.2d  1012 (1st Cir.  1992).  However,  "[w]hen
        

any factor  important  to  the  sentencing  determination  is

reasonably in dispute, the parties shall be given an adequate

opportunity to present information to the court regarding the

factor."  U.S.S.G.   6A1.3(a).  Except with respect to cross-

examination,  post,  defendant   does  not  claim  that   his
                  

                             -3-

presentation  was substantively  curtailed; his  complaint is

that the refusal to hear it on oral testimony was an abuse of

discretion.  United States v. Gerante, 891 F.2d 364, 367 (1st
                                     

Cir. 1989); see also Fed. R. Crim. P. 32(a)(1).
                    

          In the  written record  there was the  pre-sentence

report  containing a  lengthy  statement  from defendant  and

favoring and unfavoring opinions of experts.  The court chose

to accept the latter, concluding,

          I have no confidence at all . . . in that
          defense.  I have  no doubt that this case
          has had a severe and traumatic effect  on
          Mr. Regan, but I  fear that that all took
          place  after he  was  caught.   I do  not
          believe   he   was   diminished  in   his
          capacity.   I accept the report of Doctor
          Strasburger.   And  during the  course of
          his   criminal   conduct,   he  was   not
          diminished in his capacity.

We review the  evidence as the  best approach to  defendant's

contention that  the court  abused its discretion  in denying

oral presentation.   Basically, defendant contends diminished

capacity produced  a delusional  conviction that  the country

was faced with economic, and hence political, chaos for which

he must fortify  himself.  In the late 1970s  and early 1980s

he  stored  dried foods  in  his  cellar, ultimately  several

years' supply,  stored firewood,  and  made arrangements  for

water and  other necessities.   These were all  acquired with

defendant's  own  earnings.   Commencing  in  November  1987,

however, defendant  exercised what  the record shows  to have

been highly  skillful and comprehensive methods  -- hence the

                             -4-

55  counts  -- to  divert Bank  funds.   Their  ingenuity and

effective concealment, evoking no suspicions, show remarkable

ability.  The proceeds largely were salted away in Swiss bank

accounts.    Shortly after  his  discovery  and discharge  by

Shawmut, defendant voluntarily entered McLean Hospital, where

he  was found  to  be profoundly  disturbed.   At  first  his

condition was too serious to assist in his defense, but after

two admissions he sufficiently recovered,  and ultimately was

allowed to plead.

          In  connection with  the  coming  sentence  hearing

defendant  submitted records from McLean Hospital and letters

from three  psychiatrists.   The earliest  was from  a McLean

Hospital doctor, Joseph Triebwasser, dated August 9, 1991, at

which time defendant was  severely psychotic, indicating that

this severe illness was  consistent with his alleged criminal

activities prior  to his  admission.   This brief letter  was

addressed  to insurance  coverage  and is  of no  substantial

value.  On November 21, 1991 Dr. Martin J. Kelly addressed  a

letter  to  the  court  with  relation  to  defendant's  then

inability  to  participate in  legal  activities.   This  was

followed  by  a  letter  from Dr.  Kelly  with  reference  to

sentencing, dated December 13, 1991 in which the doctor spoke

                             -5-

of  defendant's  competence, his  high intelligence,  and his

ability

          to function, except when  it deteriorates
          into  psychosis as  it has  from time  to
          time over the past 10 years. . . .[1]

               It  is  difficult  to  say  that Mr.
          Regan did not have the capacity  to known
          (sic) the nature and  quality of his acts
          or did not have the capacity to know that
          what he  was doing was wrongful  in light
          of  his  own  behavior, his  capacity  to
          function  at work, and  as mentioned, his
          intelligence.  But, the behaviors seem to
          me  in   large  measure  driven   by  his
          psychiatric  problems which  occasionally
          deteriorate to the point of faulty realty
          testing  and  frank psychosis.   However,
          for  much of the past 10 years he has not
                                                   
          been  in a  psychotic  state  and  during
          those  periods  was   also  involved   in
          hoarding money as well as  provisions and
          arming  himself  in  anticipation of  the
          looming  economic collapse  and resultant
          anarchy.  (Emphasis in original).

This was followed  by a letter  from Dr. Pierre  V. Mayer  in

which he said,

          I  wanted to  let  you know  that I  have
          received    Dr.   Kelly's    report   and
          essentially agree with  his findings.  (I
          would qualify this  by adding  that I  am
          not convinced that Mr. Regan did not have
          some degree of psychosis over the past 10
          years).

          This less  than forceful opinion was  followed by a

further letter from Dr. Kelly.

                    

1.  We  interject  here  that  there is  no  evidence  beyond
medical  opinion, except  from  defendant  himself, that  his
abilities  ever deteriorated  or  faltered.   His  associates
never observed such.

                             -6-

          In response, the government submitted a report from

Dr. Larry  H.  Strasburger.   After  indicating that  he  had

reviewed defendant's personal  history as given to  him in an

interview   and  the   medical  records,  the   letters  from

defendant's experts, and interviews with officers at the Bank

who  had  dealt  with  defendant,  the  doctor  concluded  as

follows:

               There  was no  information available
          to this examiner which  would corroborate
          the existence of a psychosis prior to Mr.
          Regan's hospitalization in July  of 1991.
          While  delusional  beliefs and  psychotic
          thinking may  have been present  prior to
          the    discovery     of    Mr.    Regan's
          embezzlement,  these  phenomena were  not
          evidenced   to   the  coworkers   whom  I
          interviewed.    They   stated  that   Mr.
          Regan's  capacity  to  think clearly  and
          effectively  was  an  extraordinary  one,
          quite  at  variance  with  the  psychotic
          mental state documented  on his  hospital
          admissions and during my  interviews with
          him.   It  is entirely  possible,  indeed
          even  likely,  that  his   psychosis  was
          precipitated  by  the  discovery  of  his
          misappropriation of funds.

               Even were Mr.  Regan's psychosis  to
          have  existed  prior to  his embezzlement
          coming  to  light, the  evidence  that it
          affected his thinking and  diminished his
          mental  capacity is  confined to  his own
          statements.    The bank  officers  whom I
          interviewed describe him as  an extremely
          effective   thinker,    negotiator,   and
          problem  solver.   Even  were he  to have
          held  delusional  ideas,   there  is   no
          evidence  that  his cognitive  capacities
          were  impaired  by  them.   It  is  quite
          possible that, even if he had entertained
          delusions,    he    could    also    have
          misappropriated funds simply for personal
          gain.  Given the information available to

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          me, it is  not possible  to resolve  this
          question from a psychiatric perspective.

          Prior to the sentencing  hearing defendant moved to

present oral testimony of the  doctors and for permission  to

cross-examine Dr. Strasburger.  The court denied this motion.

At  the  hearing,  after  briefly  stating  its  reasons  for

concurring with  Dr. Strasburger, it  expressed its  ultimate

conclusion previously quoted.

          Following its  decision from  the bench, the  court

allowed defendant to  file an  offer of proof  to permit  the

court to  reconsider.  Thereafter defendant  filed a further,

two page letter  from Dr.  Kelly, and a  seven page,  single-

space, letter from Dr. Mayer.  The former added little.   The

second  was full and detailed, but, at bottom, did not change

the picture; there remained  two views.  We  have, therefore,

an  experienced   judge,  who  spoke  thoughtfully,  "I  have

reviewed  this record  very  carefully, and  I  have done  it

several  times over the past week."  The record was unusually

extensive.  In  addition he agreed to  receive further proof,

and no doubt equally  considered it.  That this  evidence was

not allowed  to  be  presented orally  was  well  within  the

court's  discretion.   United  States v.  Pugliese, 805  F.2d
                                                  

1117,  1123 (2d  Cir.  1986).    See  also  U.S.S.G.    6A1.3
                                          

Commentary.

          There  remains that  defendant was  not allowed  to

cross-examine  Dr. Strasburger.   We  have never  held it  an

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abuse of discretion  to deny cross-examination in  sentencing

hearings.   E.g., United  States v. Zuleta-Alvarez,  922 F.2d
                                                  

33,  36 (1st Cir. 1990), cert. denied, 111 S.Ct. 2039 (1991).
                                     

This  would not be the case to  begin.  While offers of proof

are not  normally required in connection with cross-examining

a  hostile witness, see United States  v. Colonial Motor Inn,
                                                             

Inc., 440 F.2d  1227, 1228 (1st Cir. 1971),  this was an area
    

where defendant should well  know what he would ask or try to

elicit from  Dr. Strasburger.  Cf. United States v. Shattuck,
                                                            

ante.    In  his  offer  of  proof  he  made  no  substantive
    

suggestions.  We see no error.

          In closing  this aspect, this  is not a  case where

the defendant  was of general diminished  capacity, but quite

the  contrary.  His extreme  views were on  a single subject,

and  even here they merely pursued opinions that were held by

other  doomsayers, and envisioned  conditions not  unknown to

history.  Defendant had read  depressing books, and his  work

in the Bank was with economic entities that were moribund, or

nearly so.  Even  if a reduced sentence could be warranted in

the  case of a  single delusion,  it does  not follow  that a

delusion means psychosis.  In any event, according to his own

expert, defendant continued his conduct, which he knew to  be

wrongful,  during  intervals  when,  concededly,  he was  not

psychotic.   This  is an unusual  case, and we  have given it

much  attention, but  the  court had  defendant's case  fully

                             -9-

before it, and we believe that to complain about  a breach of

discretion in not receiving it orally is truly frivolous.

                             -10-

                      Continuing Offense
                                        

          During Regan's embezzlement  activities the  United

States Sentencing  Guidelines   2B1.1(b)(1) was  amended with

the result  of increasing the base level  enhancement for the

amount here  embezzled from  twelve levels  to fifteen.   See
                                                             

U.S.S.G.  Manual, Appendix  C,  pp. 39-40,  Amendment No.  99

(effective  Nov. 1, 1989).   The court applied the amendment,

and   defendant  complains   this  was   an  ex   post  facto
                                                             

deprivation.   The ex post  facto clause of  the Constitution
                                 

"forbids the application  of any law  or rule that  increases

punishment for  pre-existing  conduct."    United  States  v.
                                                         

Havener,  905 F.2d 3, 5  (1st Cir. 1990);  Miller v. Florida,
                                                            

482 U.S. 423 (1987).  Where a "continuing offense"  straddles

the  old and new law, however, applying the new is recognized

as constitutionally sound.   E.g., United States v. Arboleda,
                                                            

929 F.2d 858, 871 (1st Cir. 1991).  See also United States v.
                                                          

Fazio,  914 F.2d 950, 959  n. 14 (7th  Cir. 1990) (collecting
     

cases).  We agree with the defendant that the cases relied on

by the government can arguably be  distinguished in the sense

that  all involved  true straddles  where the  offense itself

began  before   the  increase   in  sentence   but  concluded

afterwards.   The  government  says  that  this was  all  one

scheme, though  variously  carried out,  to  use  defendant's

office  to embezzle from his employer.   However, pursuant to

the substitute indictment,  defendant was formally  sentenced

                             -11-

for some  offenses that  were completed before  the guideline

increase  and, if the prior guideline were applied (either to

all  the  counts  or  through  some  "blended"  method),  his

sentence would be lower.

          Nevertheless,  we think it  constitutional that the

defendant be subject to the sentence actually imposed even if

no increased  penalty is  permitted for the  convictions that

occurred before the guideline increase.  Under the guidelines

the prior  acts of embezzlement were  "relevant conduct" that

would enhance defendant's sentence for the embezzlements that

occurred after  the guideline  increase even if  he had  been

convicted   only    on   the   latter   counts.      U.S.S.G.
                

   1B1.3(a)(2); 3D1.2(b),  (d).   These two  guidelines taken

together  base  the sentence  on  the  full amount  embezzled

during  the same  course of conduct  or as  part of  the same

scheme  or plan even if a defendant is indicted and convicted

on just one  of the counts.   See  U.S.S.G.   3D1.2, Note  4,
                                 

example  4.     In   this  instance,  however   pleaded,  the

defendant's embezzlements  were manifestly  part of the  same

ongoing scheme of embezzlements.

          The  guidelines'  criminal  history provisions  are

routinely   applied  to   increase   sentences   based   upon

convictions that occurred before the guidelines were adopted.

Cf.  United  States v.  Ykema, 887  F.2d  697, 700  (6th Cir.
                             

1989),  cert. denied, 493 U.S.  1062 (1990); United States v.
                                                          

                             -12-

Cusack, 901  F.2d 29, 32  (4th Cir.  1990).   For example,  a
      

repeat offender statute may increase the sentence for a later

crime based  on convictions that occurred  before the statute

was  enacted.   See  United  States v.  Ykema,  ante, (citing
                                                    

cases).  In  those cases, as in  this one, the  defendant has

fair warning at the  time he commits his later acts  that the

prior  ones may or will  be used in  determining his sentence

for the  latter ones.  Cf. Amaral v. I.N.S., 977 F.2d 33, 36-
                                           

37 (1st Cir. 1992).   Accordingly, there is no ex post  facto
                                                             

violation in this case.   It may be that  some of defendant's

earlier 40 month  sentences could not be supported,  but they

are  to be  served  concurrently, and  as  defendant has  not

suggested prejudice we do not pursue the matter.

                         Enhancements
                                     

          Finally, defendant complains that there should have

been  no enhancements  under U.S.S.G.    3B1.3 "for  abuse of

trust,"   and  under    2B1.1(b)(4)  for  more  than  minimum

planning.  Defendant, in talking about  abuse of trust, which

he says  is already  included in embezzlement,  neglects that

  3B1.3   includes  "special   skill."     The  court   dealt

unanswerably  with  defendant's  special  skill.    Defendant

complains,  equally  unwarrantably,  that  the  size  of  the

embezzlement,   for  which   his   sentence  was   increased,

necessarily assumed  planning, so  that to  add more for  the

                             -13-

planning was  redundant.  There  could be  no end  to such  a

contention.

          Affirmed.
                  

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