              United States Court of Appeals
                         For the First Circuit

Nos. 05-2125, 05-2228

                       UNITED STATES OF AMERICA,

                                Appellee,

                                   v.

                            JAMIE EDELKIND,

                         Defendant, Appellant.


             APPEALS FROM THE UNITED STATES DISTRICT COURT
                   FOR THE DISTRICT OF MASSACHUSETTS

          [Hon. Morris E. Lasker,* Senior U.S. District Judge]


                                 Before

                          Boudin, Chief Judge,
                  Torruella and Dyk,** Circuit Judges.


     Michael J. Liston, by appointment of the court, for appellant.
     Paul G. Levenson, Assistant United States Attorney, with whom
Michael J. Sullivan, United States Attorney, and Kristina E.
Barclay, Assistant United States Attorney, were on consolidated
brief for appellee.


                            October 31, 2006




     *
         Of the Southern District of New York, sitting by designation.
     **
          Of the Federal Circuit, sitting by designation.
                 BOUDIN, Chief Judge.        Jamie Edelkind was convicted of

four counts of bank fraud directed against federally insured banks,

18 U.S.C. § 1344 (2000),1 and he now appeals.                      The story can be

briefly told, reserving details for our discussion of specific

issues       raised   on    appeal.     So    far     as   those    issues    concern

sufficiency of the evidence, we set forth the facts assuming that

the jury resolved credibility disputes and drew inferences in the

government's favor.          United States v. Romero-Carrion, 54 F.3d 15,

17 (1st Cir. 1995).

                   Facing bankruptcy in the summer of 2000, Edelkind

concocted a false resume for his stay-at-home wife Linda, forging

documents to make her appear to be a well-paid executive in a

(sham) technology company he called "Apostille, Inc."                     Using the

forged documents, Edelkind convinced a lender, America's Moneyline

("Moneyline"), to extend a mortgage of $800,000 in Linda's name in

order       to   purchase   the   former     "Honey    Fitz"   mansion       in   Hull,

Massachusetts.




        1
      Section 1344 makes it unlawful, inter alia, to "knowingly
execute[], or attempt[] to execute, a scheme or artifice . . . to
defraud a financial institution . . . ." For reasons explained in
United States v. Brandon, 17 F.3d 409, 424 n.11 (1st Cir. 1994),
the term "financial institution" is read restrictively in light of
another definition, 18 U.S.C. § 20 (2000), confining the statute's
reach to certain types of financial institutions including banks
that are "federally insured."     Brandon, 17 F.3d at 424.     The
statute also makes it unlawful to deprive a financial institution
of property by reason of fraud but the parties have focused upon
the defrauding provision.

                                        -2-
           Edelkind then repeatedly refinanced the Hull property for

larger and larger amounts, each time paying down outstanding

previous loans and retaining the surplus or "cash out" amount.   He

persuaded lenders to extend the loans on the basis of false

representations and fabricated documents, including tax forms,

showing Linda to be earning from $200,000 to over $1 million per

year.   Specifically:

                  •In September 2001, Edelkind refinanced
           the Hull property by securing a $1 million
           mortgage in Linda's name from South Shore
           Savings Bank ("South Shore"), a federally
           insured lender. He retained $143,781.53 after
           paying down the Moneyline loan.

                  •In spring 2002, Edelkind used the
           property as collateral to obtain several home
           equity loans in Linda's name, including a
           $350,000 line of credit from Wells Fargo, a
           federally insured bank.

                   •In March 2003, Edelkind refinanced the
           Hull property again, this time with a $2.1
           million    mortgage   in  Linda's   name   from
           Washington Mutual Bank ("Washington Mutual"),
           another federally insured bank. He retained
           $205,370.29 after paying off South Shore,
           Wells Fargo, and other lenders.

                  •In August 2004, representing that
           Linda's income was $1.1 million a year,
           Edelkind obtained a $3.3 million loan through
           Fairmont Funding ("Fairmont"), a non-federally
           insured mortgage broker, which funded the loan
           with the approval of Aurora Loan Services
           ("Aurora"), itself a subsidiary of Lehman
           Brothers, a federally insured bank.     Lehman
           Brothers later purchased the loan. Edelkind
           used the proceeds to pay off the Washington
           Mutual loan and an additional $356,242.38 that
           had been run up on the Wells Fargo credit


                                -3-
           line, leaving him with $569,878.83 in cash
           surplus.

           Remarkably, the last of these loans was secured after the

government in March 2004 had filed a three-count information

charging Edelkind with bank fraud in connection with the loans from

South Shore, Wells Fargo, and Washington Mutual. In early November

2004,   Linda   and   her    children    fled   to   Norway.    Approximately

$273,000 was wired to Norway and $47,000 withdrawn from ATMs in

Massachusetts and Norway between August and December 2004.

           In February 2005, the government filed a superseding

information     adding   a   fourth     count   directed   to   the   Fairmont

transaction and including criminal forfeiture allegations under 18

U.S.C. § 981(a)(1)(C) (2000) and 28 U.S.C.A. § 2461(c) (West Supp.

2005) (subsequently amended 2006).            After a jury trial later that

month, the district court entered a judgment of conviction on each

of the four counts.      In June, the court forfeited the Hull property

and two bank checks deemed to be funds derived from the offenses.

In July, Edelkind was sentenced to 60 months in prison and ordered

to pay restitution.

           Edelkind's first claim on appeal is that no proper

verdict of conviction was ever returned by the jury.              Instead of

having the jury return a written verdict of "guilty" or "not

guilty" on each count, the district judge submitted to the jury a

four-part form whose first question asked the jury to say ("yes" or

"no") whether they "unanimously find that the government has proven

                                        -4-
beyond a reasonable doubt that Jamie Edelkind knowingly executed or

attempted to execute a scheme to defraud" South Shore.      The form

then asked the same question as to Wells Fargo, Washington Mutual,

and Fairmont, respectively.

            The jury returned a written verdict of "yes" on all four

counts.     The judge then asked the foreperson, "As I read your

verdict, your answer, whether you find the defendant guilty as to

Count 1, is 'yes'; on Count 2 is 'yes'; on Count 3 is 'yes'; and

Count 4 is 'yes.'   Am I correct?"   The foreperson responded, "Yes."

Defense counsel declined the judge's offer to poll the jury and

also did not inquire whether the jury intended its verdict to be

one of "guilty" on each count.

            Although we have not adopted a flat rule against special

interrogatories in criminal cases, they pose special dangers. See,

e.g., United States v. Spock, 416 F.2d 165, 182 (1st Cir. 1969)

(progression of special questions can exert judicial pressure on

jury). They also sometimes offer benefits, notably in very complex

criminal cases, where they can reduce risk of juror confusion.

See, e.g., United States v. Palmeri, 630 F.2d 192, 202 (3d Cir.

1980).    The present appeal better illustrates the dangers than the

benefits.

            Edelkind's broadest claim is that no guilty verdict was

delivered by the jury on any of the counts.      The form did not in

terms ask whether Edelkind was guilty, and his appellate counsel


                                 -5-
suggests that the foreperson's response when questioned by the

trial judge was ambiguous.     Counsel posits that the foreperson

might have meant only that the "yes" lines had been checked--not

that the jury had intended to find Edelkind "guilty" of the

offenses specified in the indictment.

          Nothing in the rules requires a written verdict at all.

See Fed. R. Crim. P. 31.   Here, there was a written verdict which,

if ambiguous, was clarified when the judge asked whether the

defendant has been found "guilty" on each count.   The lack of any

objection when the foreperson answered and the judge proceeded to

enter a judgment of conviction shows that trial counsel had no

doubt that the jury had equated its verdict with guilt.   There was

no error, plain or otherwise, in treating the verdict as one of

guilty on each count.

          A narrower version of the argument, also made on appeal,

has more bite.    Edelkind points out that the phrasing of the

verdict form itself omitted, for each count, an element of the

statutory offense--specifically, that the defrauded institution be

one that was federally insured.    This is itself an example of the

problems with using detailed verdict forms rather than simply

asking whether the defendant was guilty of the offense charged.

          Nevertheless, we conclude that there was no prejudicial

error in the omission of the federally insured requirement from the

verdict form. Special verdicts are not required in criminal cases,


                                  -6-
and, when they are used, there is no automatic requirement that a

special verdict form include every element of the offense so long

as the jury is instructed as to all elements.           See, e.g., United

States v. Stonefish, 402 F.3d 691, 699 (6th Cir. 2005).           Here the

jury was specifically instructed that they “must be convinced

beyond a reasonable doubt” of each of the four elements of the

offense,   including   (as   one   of   the   four   elements)   that   “the

financial institution in question was federally insured.”

           The defendant's next argument is that the verdict form

and the jury instructions charged him with defrauding Fairmont and

not with defrauding Lehman Brothers, and that he could not properly

be convicted of defrauding Fairmont, which was not a federally

insured institution. The district court’s initial jury instruction

(which was given orally but later provided to the jury in written

form) described count 4 as charging Edelkind with executing “a

scheme to defraud . . . upon Fairmont Funding, LTD, which [is a]

financial institution.”      The special verdict form submitted to the

jury asked, as to count 4, whether the government had proved

           a scheme to defraud Fairmont Funding, LTD in
           connection with a loan . . . originated by
           Fairmont   Funding,  LTD,   and  subsequently
           assigned to Lehman Brothers Bank, FSB.

           Just before the court read the jury instructions and

provided the jury with the special verdict form, Edelkind filed a

motion for judgment of acquittal arguing that “Count Four is

entirely dependant on Fairmont Funding [and] the Government has

                                   -7-
failed to prove federal jurisdiction” because Fairmont is not a

financial institution under 18 U.S.C. § 20.       The basis for defense

counsel's motion was that Edelkind had to know that a "financial

institution" would be the ultimate victim of his fraud.                  The

district judge rightly found this position to be at odds with

Brandon, 17 F.3d at 425, and rejected the motion for acquittal.

           After the instructions were read to the jury, defense

counsel orally objected to them and to the verdict form on the

ground   that   Fairmont   was   not   a   financial     institution,    and

reiterated   his   position   that   Edelkind   needed    to   know   that   a

"financial institution" would be injured.       The court then provided

a curative instruction stating that “Lehman Brothers but not

Fairmont was a financial institution." Since the court had already

told the jury that a financial institution had to be defrauded or

deprived of money by fraud,2 the jury was informed that it could

not convict on the theory that the defendant had defrauded Fairmont

alone.

           It is quite true that the curative instruction came late

in the day and apparently Edelkind's counsel did not ask for a


     2
      The instructions required that the jury find that Edelkind
executed “a scheme or artifice (1) to defraud a financial
institution or (2) to obtain any of the money . . . under the
custody or control of a financial institution by means of false or
fraudulent pretenses.” The court specified that “scheme to defraud
a financial institution” meant “any deliberate course of conduct by
which someone intends to deceive or cheat that financial
institution and to obtain – and intends to obtain something of
value, such as money.”

                                     -8-
transcript page reflecting it to accompany the original written

instructions sent into the jury room; but the curative instruction

was virtually the last instruction that the jury heard before

retiring. Nor was defense counsel entitled to have the jury ignore

the fraud upon Fairmont; on the government's theory of the case,

false representations to it were the instrument by which money was

secured from Lehman Brothers.

             The question then becomes whether the jury was adequately

advised that it needed to find fraud on Lehman Brothers.           In this

respect both the verdict form and the instructions were deficient.

The verdict form made only passing mention of Lehman Brothers as

having acquired the loan. While the "cured" instructions generally

required a finding that a financial institution had been defrauded

and   that    Lehman   Brothers   was   a   financial    institution,   the

instructions failed to specifically identify Lehman Brothers as

allegedly defrauded.

             Edelkind did not request revision of the verdict form or

an instruction that, in order to convict on count 4, the jury had

to find that Lehman Brothers was defrauded.             Indeed, Edelkind's

counsel objected (unsuccessfully) to any mention of Lehman Brothers

in the supplemental instruction. Counsel had good reason to direct

attention away from Lehman Brothers; but Edelkind was surely on

notice that the government's own theory of the case was that Lehman

Brothers had been the victim of the fraud (albeit indirectly)


                                    -9-
because the fraud on Fairmont had operated to deprive Lehman

Brothers of its money.3

            Under these circumstances, we conclude that Edelkind's

failure to object to the instruction and verdict form as omitting

Lehman Brothers makes those errors reviewable only for plain error.

Fed. R. Crim. P. 52(b); United States v. Newton, 891 F.2d 944, 949

(1st Cir. 1989).    Edelkind says that trial counsel had a duty to

object only to mistakes inimical to his client's interest, not to

ones that would undermine any verdict against his client.            The

potential of such errors to undermine the verdict is why an

objection is required at the time--not an excuse for failing to

make a timely objection.

            Edelkind also says that the errors were "structural,"

requiring   reversal   without   regard   to   prejudice.    "Structural

errors" comprise a small category of mistakes so identified by the

Supreme Court, but generally exclude erroneous jury instructions

(despite the fact that they "preclud[e] the jury from making a

finding on the actual element of the offense").             See Neder v.

United States, 527 U.S. 1, 9-10 (1999) (collecting examples).        The

error in Neder itself–-the omission of an element of the offense




     3
      For example, at the charge conference, defense counsel
stated: "And it's the government's view that when a defendant deals
with somebody like Fairmont Funding . . . and then they happen to
sell their . . . paper to a federally insured bank like Lehman
Brothers, that you just assume the risk so-to-speak."

                                  -10-
from the instructions-–was not deemed structural; mere lack of

clarity is clearly a lesser error and not "structural."

           To establish "plain" error, Edelkind must show (1) error,

(2)   plainness,    (3)    prejudice,     and   (4)   an   outcome    that     is   a

miscarriage of justice or akin to it.           United States v. Olano, 507

U.S. 725, 732-37 (1993). The flaws in the initial instructions and

verdict form were error and only partly corrected as to the former;

we will assume that any remaining error was plain.                   The problems

for Edelkind are to show prejudice and miscarriage of justice.

           The banking institutions defrauded in the first three

counts were federally insured.              As to count 4, the evidence

(discussed below) amply permitted a reasonable jury to find that

Lehman Brothers was defrauded. Therefore Edelkind cannot show that

the   mistakes     probably     altered   the   outcome     or     undermine    our

confidence in the verdict, United States v. Dominguez Benitez, 542

U.S. 74, 81-82 (2004); Olano, 507 U.S. at 734, let alone constitute

a miscarriage of justice.

           Turning to the sufficiency of the evidence, Edelkind's

attack on this ground is directed only to count 4.                 The government

questions whether his motion for a judgment of acquittal in the

district court preserved all of the claims he now makes under this

head.   Because we find that the evidence was sufficient in each of

the   aspects    raised,   we    bypass   the   waiver     issue    (which   poses

difficulties of its own).


                                     -11-
            Section   1344,    as   already    noted,     makes    criminal   the

knowing execution of a scheme to defraud a federally insured bank.

See note 1, above.       Neither Fairmont nor Aurora was federally

insured.     Edelkind   says    that   there    is   no    proof   that   Lehman

Brothers, although federally insured, was the intended or direct

victim of his scheme to defraud, and therefore the scheme cannot

have been one "to defraud a financial institution" as defined by

Congress.

            The statute says that the scheme to defraud a protected

financial institution must be "knowingly" executed. In Brandon, 17

F.3d at 425, this court held that the government does not have to

show that the defendant knew which particular bank might be injured

or that it was federally insured.           Id. at 426.     The statute gives

fair warning that bank fraud is unlawful: one who defrauds a bank

simply assumes the risk that the victim is federally insured.                 Id.

            The greater difficulty, and the main focus of Edelkind's

objection, concerns whether Lehman Brothers was in fact defrauded.

Edelkind secured the count 4 loan from Fairmont, which was not

federally insured.       But the government offered evidence that

Fairmont did no more than "table fund" the loan, that is, it agreed

to make the loan only if another lender first agreed to purchase

the loan thereafter. The other lender, on the government's theory,

was Lehman Brothers.




                                     -12-
            Edelkind argues on appeal that Lehman Brothers was not

the   victim   of   his    scheme   to    defraud    because   his   fraudulent

statements about his wife's credentials and earnings never reached

Lehman   Brothers;    he    says    the   misrepresentations     only    reached

Aurora, Lehman Brothers' non-federally insured subsidiary.                   So,

Edelkind says, he never defrauded Lehman Brothers as section 1344

requires.

            Neither the statute nor the case law fully instructs just

how tight a factual nexus is required to allow a jury to decide

that a scheme, formally aimed at one (uninsured) company, operates

in substance to defraud another (insured) entity with whom the

defendant has not dealt directly.            In our view the statute does

apply where the federally insured institution takes part in an

integrated transaction and is thereby injured by the defendant, who

intended to defraud another party to the transaction.                   Scienter

exists, the causal connection is sufficient, and under Brandon the

defendant cannot escape liability by virtue of his ignorance of the

overall arrangement.

            Here,    the   government      offered    evidence   that     Lehman

Brothers' forms and guidelines were used by Fairmont and Aurora in

table funding the loan, that a Lehman Brothers official (not just

its subsidiary Aurora) signed off on the loan before Fairmont made

it, and that Fairmont transferred the loan to Lehman Brothers--not

to Aurora--about a month after the closing between Edelkind and


                                      -13-
Fairmont.    Thus the loan--although formally made by Fairmont--was

from the outset part of an integrated transaction, the first step

of which was dependent on approval by Lehman Brothers, and the pre-

planned second step of which was a transfer of the mortgage to

Lehman Brothers itself.

            Given these predicates--Edelkind's intent to defraud, the

integrated transaction, and the financial injury to which Lehman

Brothers was exposed--the jury was entitled to find that Edelkind

defrauded   Lehman   Brothers,   a   federally   insured   bank.4   The

situation would be quite different, and liability might well be

doubtful, if the involvement of the federally insured entity was

not contemplated at the outset and came about later from a separate

transaction, for example, by the happenstance of an insured bank

purchasing an earlier loan under-secured because of an earlier,

independent fraud.     We leave such line-drawing for a case that

poses the issue.

            We turn now to an ancillary order of forfeiture following

the jury verdict.     In this criminal proceeding, the government

sought forfeiture, pursuant to 18 U.S.C. § 981(a)(1)(C) and 28

U.S.C.A. § 2461(c), of the Hull property used in the scheme and of

$579,805.73 in proceeds traceable to the final loan. Edelkind



     4
      Edelkind says the government offered no proof that Lehman
Brothers was federally insured on the day that it took over the
Fairmont loan, but Lehman Brothers was insured when it approved the
Fairmont loan, thus exposing itself to ultimate loss.

                                 -14-
argues that the two forfeiture statutes invoked by the government

do not allow this forfeiture to be implemented in a criminal

proceeding, but rather only in a separate civil proceeding.5

            The argument turns upon a difference in the scope of the

main federal statutes governing civil and criminal forfeitures, 18

U.S.C. §§ 981, 982, on a bridging statute, 28 U.S.C.A. § 2461(c),

and on a related factual premise. The civil forfeiture statute, 18

U.S.C. § 981(a)(1)(C), pertinently subjects to forfeiture any

property "which constitutes or is derived from proceeds traceable

to"   a   violation    of   section     1344;        by   contrast   the   criminal

forfeiture    statute,      18    U.S.C.       §    982(a)(2)(B),    subjects     to

forfeiture "any property constituting, or derived from, proceeds

the person obtained directly or indirectly, as the result of" such

a violation (emphasis added).

            Edelkind    says     that   the        property   forfeited    here   was

obtained by his wife and therefore is not property that he ("the

person") ever obtained.          Therefore, he concludes, the property was

open to a civil forfeiture action but not a criminal one.                         The

government answers by saying that the bridging statute, 28 U.S.C.A.

§ 2461(c), allowed it to rely upon the civil forfeiture provision


      5
      There is good reason to think that Edelkind waived this
argument at sentencing. When the judge stated that "there is no
legal question that forfeiture will be required. I haven't heard
the defense counsel argue to the contrary," defense counsel then
replied: "I think we are out of it at this point, Your Honor." No
mention was made of the argument now made on appeal. Nonetheless,
we reach the merits to resolve the issue definitively.

                                        -15-
in the criminal case. The statute, as it stood between 2000 and

2006, provided (emphasis added):

           If a forfeiture of property is authorized in
           connection with a violation of an Act of
           Congress, and any person is charged in an
           indictment or information with such violation
           but no specific statutory provision is made
           for criminal forfeiture upon conviction, the
           Government may include the forfeiture in the
           indictment or information in accordance with
           the Federal Rules of Criminal Procedure, and
           upon conviction, the court shall order the
           forfeiture of the property . . . .

           Edelkind argues that section 2461(c) does not apply in

this case because a "specific statutory provision is made for

criminal forfeiture upon conviction," namely, section 982, which

expressly applies to violations of the bank fraud statute.                The

government responds that section 982 was not available in this case

on Edelkind's own premise that the forfeited property was not his

own, and therefore it could use the bridging statute to enforce

section 981 in the criminal case.

           Edelkind's best argument is that Congress could not have

intended   section   2461(c)   to   apply   to   offenses   for   which    it

deliberately drafted criminal forfeiture provisions narrower in

scope   than   the   corresponding     civil     forfeiture   provisions.

Otherwise, section 2461(c) would override the extra limitations

that Congress imposed in the original criminal forfeiture statute

(here, the requirement that the defendant personally obtain the

property forfeited criminally).


                                    -16-
          The government's response is that section 2461(c), as it

stood when this case was tried, fills the gap between criminal and

civil forfeiture by making criminal forfeiture available in every

criminal case that the criminal forfeiture statute does not reach

but for which civil forfeiture is legally authorized.            On this

view, Edelkind's own argument that the criminal statute did not

reach the property (because it was not his) shows why the civil

statute is available (because the property was traceable to the

fraud).

          The case law is of little help. Edelkind cites to United

States v. Croce, 345 F. Supp. 2d 492, 496 (E.D. Pa. 2004), but it

has since been repudiated by the Third Circuit, see United States

v. Vampire Nation, 451 F.3d 189, 199 (3d Cir. 2006).       United States

v. Day, 416 F. Supp. 2d 79, 86 (D.D.C. 2006), followed Croce but

United States v. Schlesinger, 396 F. Supp. 2d 267, 275 (S.D.N.Y.

2005), came out the other way.

          Neither language nor case law is conclusive, but it seems

to us that Congress intended for section 2461 to apply in this

situation.   This intuition is supported by the legislative history

of the bridging statute itself.         Far from wanting to limit the

substantive reach of the criminal forfeiture statute, Congress made

clear in enacting the bridging statute that it hoped to encourage

the use of criminal forfeiture procedures, with their greater

protections,   "whenever   any   form    of   forfeiture   is   otherwise


                                 -17-
authorized by statute."         H.R. Rep. 105-358(I), 1997 WL 677201 at

*35-36 (1997).6       Our intuition is further confirmed by Congress'

later     amendment   that    resolves     doubts   for     the   future   in   the

government's favor.      See USA PATRIOT Improvement and Authorization

Act of 2005, Pub. L. 109-177, § 410 (2006).

             Thus, if Edelkind is right that section 982(a)(2) would

not authorize forfeiture in this case, then "no specific statutory

provision" provided for criminal forfeiture upon his conviction,

and   section    2461(c)      authorizes    the     court    to   apply    section

981(a)(1)(C) to fill the gap.        If Edelkind's premise is wrong and

section 982(a)(2) would authorize criminal forfeiture in this case,

then section 2461(c) does not apply--but neither has Edelkind been

prejudiced by the government's citation error.                See Rule 7(c)(3).

             The last issue on this appeal concerns the calculation of

Edelkind's sentence.         The sentencing guideline range is driven in

part by the amount of loss resulting from the offense and in part

by other factors.      U.S.S.G. §2B1.1(b).          Using the 2004 edition of

the guidelines, the district court determined that Edelkind's

violations had inflicted a net loss exceeding $1 million--bringing

the offense level to 23, §2B1.1(a)(1), (b)(1)(I); and that a


      6
      See also H.R. Rep. 106-1048, 2001 WL 67919 at *61 (2001)
(Congress intended to make criminal forfeiture available "wherever
federal law allows for civil forfeiture of property involved in a
specific crime..."); H.R. Rep. 105-358(I) at *35 (stating that the
purpose of the amendment was to "give the government the option of
pursuing criminal forfeiture as an alternative to civil forfeiture
if civil forfeiture is otherwise authorized.").

                                     -18-
further two level enhancement (to 25) was required because--in the

words of the guideline--"the defendant derived more than $1,000,000

in gross receipts from one or more financial institutions as a

result of the offense."      Id. §2B1.1(b)(13)(A).

            At sentencing, the judge proposed to use an offense level

of 25, and defense counsel began to argue that the net loss was

under $1 million, which would have substantially reduced the

offense level; but counsel conceded that if the gross receipts

enhancement   applied,   the   language   of   section   2B1.1(b)(13)(D)

prescribed a minimum offense level of 24 regardless of a smaller

net loss.   The judge, it appears, adopted this solution, departing

downward slightly in the final sentence.7

            Edelkind does not dispute that he inflicted gross losses

in excess of $1 million; but he says that the "gross receipts"

enhancement should not have been applied because the gross receipts

were derived not by Edelkind, but by his wife--in whose name the

Hull property had been acquired and to whom the proceeds of the

refinancing   loans   were   directed.    He   adds   that   a   prenuptial

agreement with his wife provided that property and assets obtained

by her were to be and remain her personal property.




     7
      An adjusted offense level of 24, given Edelkind's criminal
history, corresponded to a range of 63 to 78 months. Because the
judge thought that the criminal history points overstated
Edelkind's past wrongdoing, the judge departed downward to the 60-
month sentence ultimately imposed.

                                  -19-
               The district court rejected this argument, reading the

guideline to refer not to a defendant's formal legal control of the

gross receipts, but instead to his individual culpability.                 The

district judge stated: "It seems to me that if you procure funds

for somebody else and the other person gets the advantage of it,

that your moral responsibility is the same whether you take the

money or not, particularly if the person you get it for is your

wife."       We review de novo the meaning of the guideline.         See United

States v. Alli, 444 F.3d 34, 37 (1st Cir. 2006).

               What case law exists largely supports a realistic rather

than     a     formal   approach     to    applying   the   "gross   receipts"

enhancement.        Several cases support the enhancement where the

wrongfully obtained funds went to a company controlled by the

defendant even though the funds were held in the corporation's

name.        See United States v. Pendergraph, 388 F.3d 109, 113 (4th

Cir. 2004) (defendant had controlling interest in company and "thus

controlled the fraudulently acquired funds"); United States v.

Stolee, 172 F.3d 630, 631 (8th Cir. 1999) (per curiam) (defendant

was "the sole owner and president" of the company); United States

v. Bennett, 161 F.3d 171, 192-93 (3d Cir. 1998) (defendant had 100%

interest in company).        Compare       United States v. Colton, 231 F.3d

890,    911-12     (4th   Cir.     2000)    (distinguishing   non-controlling

interest).




                                          -20-
             To sustain the result in this case, it is enough here to

hold that the enhancement is not automatically defeated because

formal ownership of the "gross receipts" is in another.                Rather,

given its aim, the guideline may be applied where the defendant

either     controls   (even   though      indirectly)   the   fraud   proceeds

attributed to him or where he causes them to be lodged in another

with the expectation that he will enjoy the benefits.               Whether any

lesser showing would suffice need not be decided.

             This reading distinguishes property that goes solely to

a co-conspirator and, on the affirmative side, it charges the

defendant with proceeds that he controls or enjoys.             Such proceeds

can, as a matter of language, be regarded as individually derived

by the defendant.     Given the guideline's concern with culpability,

this reading makes far more sense than making the guideline turn

solely upon formal ownership under state marital or real property

law.

             United States v. Castellano, 349 F.3d 483, 485-87 (7th

Cir. 2003), relied upon by Edelkind, is arguably sound on its own

facts and easily distinguishable.           There the defendant had founded

the company holding the proceeds but did not own any stock; and

only a modest portion ($200,000) of what the fraud netted the

company could be traced through to the defendant's compensation.

So   far   as   Castellano    is   read   to   make   state   law   formalities




                                      -21-
conclusive, it would conflict with the realistic approach taken by

other circuits, which we follow here.

             The pre-sentence report notes that "[w]ith the borrowed

money, Edelkind... financed a lavish lifestyle for himself and his

family."     Although Edelkind objected to certain details in the

report's assertion, the thrust of the report is supported by other

evidence and reasonable inference.      Thus, the record confirms that

Edelkind enjoyed the fruits of the scheme to defraud, and having

masterminded the scheme and enjoyed benefits from it, Edelkind

himself "derived" the illegal loan proceeds within the terms of the

guideline.

           Edelkind next says that the $1 million gross receipts

figure can be met only if the Fairmont loan proceeds are included--

it being the largest of refinancings–and that they should not be

included because under section 2B1.1(b)(13)(A) of the guidelines,

the receipts exceeding $1 million must be derived "from one or more

financial institutions" (emphasis added).        As noted, Fairmont was

not a financial institution within the meaning of section 1344.

           However,   the   guideline   has    its   own   definition   of

"financial institution" which includes "any state or foreign bank,

trust company, credit union, insurance company, investment company,

mutual fund, savings (building and loan) association, union or

employee pension fund;... and any similar entity, whether or not

insured by the federal government."           §2B1.1 Application Note 1


                                 -22-
(emphasis added).          In other words, it is the character of the

institution     and    not     federal       insurance     that    matters      to    the

guideline.

             Fairmont was described by its witness at trial as "a

mortgage bank, mortgage lender" and referred to in its affidavit as

a "licensed private mortgage lender." Edelkind offers us no reason

to   think   that    Fairmont       falls    outside    the     circle    of   "similar

entities," and the case law confirms a broad interpretation.

United States v. Ferrarini, 219 F.3d 145, 161 (2d Cir. 2000)

("premium finance company" is within the application note); see

also   Brandon,       17   F.3d     at   426      (using   the     term    "financial

institution" colloquially to include uninsured mortgage brokers).

             Finally, Edelkind points to an apparent computational

error in determining the amount of net loss from his frauds--the

figure that drove the initial determination of his offense level

(before the gross receipts enhancement).                        The district court

calculated    the     gross    amount       of   the   frauds    and   then,     as   the

guideline provides, subtracted the present value of the mortgaged

Hull property, which remained available to offset the losses.

U.S.S.G. §2B1.1 Application Note 3(E).

             In calculating the value of the Hull property, the

district     judge    picked    a    figure      between   the    widely       differing

estimates offered by the government and by Edelkind.                       Well after

sentencing, it emerged from a newly discovered memorandum that--in


                                         -23-
making his own calculation--the district judge had apparently

adopted a final net loss figure $500,000 higher than he had

intended. At sentencing, counsel knew the final figure adopted but

not the judge's private miscalculation.

            The time for correcting the sentence had passed, Fed. R.

Crim. P. 35(a), and this appeal had already been lodged with this

court.    The district judge said at a post-sentencing conference

concerning the calculation error that he would leave the matter to

this court, which could remand, if necessary.              The judge said that

he was not prepared to say whether use of the lower net loss figure

he had intended would have made any difference to the sentence.

            It is clear that the error did not matter.            The district

court    used   an   offense   level   of     24   in   determining   Edelkind's

sentence before departing downward.                As already explained, the

gross receipts enhancement prescribed a minimum offense level of 24

regardless of the net loss.        §2B1.1(b)(13)(D).         Edelkind concedes

in his brief that "[i]f the §2B1.1(b)(13) enhancement applies"--as

we have found that it does--"the offense level would rise to 24 in

both cases."     Thus, the net loss figure, whether in error or not,

had no ultimate effect on the sentence.

            Affirmed.




                                       -24-
