                             UNPUBLISHED

                    UNITED STATES COURT OF APPEALS
                        FOR THE FOURTH CIRCUIT


                             No. 07-4112



UNITED STATES OF AMERICA,

                                              Plaintiff - Appellee,

           versus


BARBARA BLAND,

                                              Defendant - Appellant.



Appeal from the United States District Court for the Northern
District of West Virginia, at Clarksburg. Irene M. Keeley, Chief
District Judge. (1:06-cr-00064-IMK)


Argued:   January 29, 2008                  Decided:   March 7, 2008


Before MOTZ, TRAXLER, and DUNCAN, Circuit Judges.


Affirmed by unpublished per curiam opinion.


ARGUED: Charles T. Berry, BOWLES, RICE, MCDAVID, GRAFF & LOVE,
P.L.L.C., Morgantown, West Virginia, for Appellant.  David Earl
Godwin, Assistant United States Attorney, OFFICE OF THE UNITED
STATES ATTORNEY, Clarksburg, West Virginia, for Appellee.    ON
BRIEF: Sharon L. Potter, United States Attorney, Wheeling, West
Virginia, for Appellee.


Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:

     Barbara    Bland   (“Bland”)   pleaded   guilty    to    one   count   of

attempted federal financial aid fraud in violation of 20 U.S.C.

§ 1097(a).     She was subsequently convicted and sentenced to two

years’ probation, with the first six months to be served in home

detention. On appeal, Bland contends that the district court erred

by sentencing her as a felon, rather than as a misdemeanant.

Because we find that Bland pleaded guilty to a felony offense under

§ 1097(a) and that her guilty plea is supported by a sufficient

factual basis, we find no error and affirm.


                                    I.

      In 2001, Bland opened the Art and Science Institute of

Cosmetology    and   Massage   Therapy   (“ASIC”)   in       Fairmont,   West

Virginia.     In September 2004, she applied to the United States

Department of Education (“DOE”) for ASIC to become certified to

participate in the federal financial aid programs under Title IV of

the Higher Education Act of 1965 (“Title IV”).         Pub. L. No. 89-329,

79 Stat. 1219 (codified as amended at 20 U.S.C. §§ 1070 et. seq.).

As a Title IV eligible institution, qualified ASIC students would

have been allowed to seek federal financial aid to help fund their

tuition.    See 20 U.S.C. § 1070.    Bland commenced the certification

process by submitting an “Initial Application for Approval to be

Designated as an Eligible Institution and to Participate in the

Federal Financial Assistance Programs” pursuant to the Title IV

                                    2
regulations.    See 34 C.F.R. § 600.20(a).   Next, Bland was required

to obtain and submit an audited financial statement for ASIC for

fiscal year 2003, prepared in accordance with “Government Auditing

Standards.”    See id. § 668.23.   She hired Michael Henderson, CPA

(“Henderson”) of the accounting firm Oliver & Henderson, who

prepared a compilation report1 of ASIC’s financial standing, rather

than a more costly audited financial statement. Bland subsequently

used the information entered in the compilation report to create a

false audited financial statement, forged Henderson’s signature,

and submitted the statement to the DOE on a fabricated Oliver &

Henderson letterhead.    The fraudulent submissions were detected by

the DOE.   During the course of the ensuing DOE investigation, a DOE

employee contacted Bland and informed her that ASIC’s Title IV

application would not be considered for approval until Bland

submitted an additional audited financial statement for fiscal year

2004.    Bland never submitted the statement and the application was

never approved.    As a result, neither ASIC nor any of its students

received funds from the DOE.

     Bland was later indicted in the United States District Court

for the Northern District of West Virginia on five counts stemming

from her submission of the fraudulent application.     Bland entered



     1
      A compilation report is a collection of financial statements
created solely from the representations of management, with no
audit or independent review of the reported figures. A compilation
report does not conform to Government Auditing Standards.

                                   3
into a plea agreement in which she agreed to plead guilty to one

count of federal financial aid fraud, in violation of 20 U.S.C.

§ 1097(a), in exchange for the dismissal of the other four counts.

The agreement indicated that the maximum statutory penalties to

which Bland would be exposed were: “(1) imprisonment for a period

of not more than 5 years;” “(2) a fine of up to $250,000;” “(3) up

to three (3) years of supervised release;” and, “(4) a special

assessment of $100.00.”    J.A. 11-12.     The government agreed to

recommend as “lenient a sentence as an application of the advisory

sentencing guidelines will allow.”       J.A. 13.   Bland, in turn,

waived “any right she may have [had] for a jury determination of

any and all facts relevant to sentencing,” and consented to the

determination of such facts by the sentencing court.    Id.

     At Bland’s plea hearing, the district court first sought to

determine whether Bland was aware of the contents of the plea

agreement and the ramifications of a guilty plea.   As part of this

determination, the court asked Bland if she understood that the

statutory “maximum period of imprisonment” for the crime to which

she was pleading guilty was “five years.”      Plea Hr’g Tr. at 19.

Bland responded, “Yes ma’am.”   Id.   Bland responded in the same

manner when asked whether she understood that “there[] [was] a one

hundred dollar mandatory special assessment that has to be paid for

the felony conviction on or before the date of your sentencing.”

Id. at 20.


                                4
       The court next sought to determine whether there existed a

sufficient factual basis to support Bland’s guilty plea.                           To so

establish, the government called as a witness George Blissman

(“Blissman”), a Special Agent employed with the DOE Office of

Inspector General.           Blissman testified that after interviewing

Bland’s       accountant,     Henderson,       he    discovered      that    the    2003

financial statements submitted by Bland “weren’t prepared by the

CPA who was represented as preparing them. . . . They were not

signed by him and the letterhead used on the reports were not ones

that he would use.”          Id. at 31.        Blissman further testified that

Bland    admitted       to   him   that   she       had   prepared    the    financial

statements with the assistance of a member of her staff, and that

they    had    forged    Henderson’s      signature.         Following      Blissman’s

testimony, Bland entered her plea of guilty, at which time the

following dialogue took place.

            THE COURT: Did you in fact do what Mr. Blissman
       testified regarding the preparation of the application
       for financial aid and the further preparation of the
       financial statements that were questioned later by the
       Department of Education?

               THE DEFENDANT:      Yes ma’am.

       . . . .

            THE COURT: Okay. You took information that Mr.
       Henderson had done as a compilation, which is a term of
       art under accounting, and then you managed to put it into
       a format that was required by the Department of Education
       and then signed his name to it, correct?

               THE DEFENDANT:      Yes.


                                           5
          THE COURT: All right. So in point of fact then,
     you took someone else’s compilation of financial
     information, put it in a different format and represented
     that it had been done by Mr. Henderson on behalf of you
     and your school, correct?

             THE DEFENDANT:   Yes.

Id. at 35-37.    The court then made the following findings in regard

to Bland:

     I find that you are aware of the consequences of the plea
     and that there is a factual basis for the tendered plea
     and that’s based both on the testimony of Mr. Blissman
     and your allocution to the . . . elements of the offense.
     I find that . . . because there is a factual basis for
     the plea and that you knew what you were doing here, that
     your plea of guilty to Count One should be accepted and
     I, therefore, accept your plea of guilty to Count One.

Id. at 38.

     Immediately following the acceptance of Bland’s plea, the

court asked the government if Bland would “have any licensure

issues [with respect to the operation of ASIC] now that she’s

tendered a plea of guilty to a felony.”    Id. at 39.   The government

responded, “I don’t really know what effect--I’m not aware of

anything.” Id. at 40.     The court then addressed the question to

Bland’s attorney who answered, “Well, certainly there could be some

fallout from a guilty plea” but it is “not automatic.”      Id.   There

was no further discussion on the issue and the hearing concluded.

     The Presentence Investigation Report (“PSR”) was prepared on

November 9, 2006.    It listed Bland’s offense as a “Class D Felony”

with a corresponding penalty of “5 years/$250,000.” J.A. 117. The

PSR indicated that under the United States Sentencing Guidelines

                                     6
(the “Guidelines”), the base offense level for a violation of

§ 1097(a) was 6.    The PSR suggested that the offense level be

increased by 6 levels in this case based upon the estimated $48,710

to $69,520 intended loss range of Bland’s fraud.2     The PSR also

recommended that Bland be given a 2-level reduction pursuant to

U.S.S.G. section 3E1.1(a) for Acceptance of Responsibility. Though

Bland filed four written objections to the PSR, she made no

objection to the PSR’s classification of the offense as a Class D

Felony, the listed maximum statutory penalties, or the estimated

intended loss range.

     In her sentencing memorandum filed December 1, 2006, Bland

asserted for the first time that because her attempted fraud was

unsuccessful and procured no funds, she should be sentenced under

the “misdemeanor exception” of § 1097(a).    As will be discussed

more fully below, the “misdemeanor exception” limits the punishment

for certain violations of § 1097(a) to a fine of no more than $5000

and a term of imprisonment not to exceed one year.          At the

sentencing hearing on January 3, 2007, the district court rejected

Bland’s argument, finding that the government’s contention that


     2
      The Guidelines require calculation of the loss at issue in
each specific case, which is the greater of the intended loss and
the actual loss.     U.S.S.G. § 2B1.1. Cmt. n. 3(A).        Section
2B1.1(b)(1) sets out the offense-level increases corresponding to
various ranges of loss amounts.      The estimated intended loss
figures in this case were predicated upon Title IV eligibility
percentages and grant and loan amounts from similar institutions in
the state of West Virginia and schools with similar student
populations in the Fairmont area.

                                7
unsuccessful attempts at procuring funds illegally are not covered

by the exception “ma[de] the most sense.”        J.A. 79.      The court

further found that “under 20 U.S.C. Section 1097(a), this is not a

misdemeanor offense.   This is a felony offense.     Moreover, I find

as a fact that that is exactly what Ms. Bland knew when she pled

guilty to the offense back in September of 2006.” J.A. 79-80.

Therefore the court concluded that it “w[ould] not sentence her as

a misdemeanant,” but “w[ould] sentence her pursuant to the felony

provisions of the statute.”   J.A. 80.    Then, based on the intended

loss range in the PSR, Bland was sentenced, as a felon, to two

years’ probation with the first six months in home detention--the

bottom of the Guideline range.       Bland filed a timely notice of

appeal.



                                 II.

     On appeal, Bland challenges neither her conviction under

§ 1097(a), nor the factual basis supporting the conviction, nor

“the actual term of her sentence.”     Appellant’s Br. at 7.    Instead,

she assigns error solely to the district court’s decision to

sentence her as a felon rather than as a misdemeanant.

     Section 1097(a) provides:

     Any person who knowingly and willfully embezzles,
     misapplies, steals, obtains by fraud, false statement, or
     forgery, or fails to refund any funds, assets, or
     property provided or insured under this subchapter and
     part C of subchapter I of chapter 34 of Title 42 or
     attempts to so embezzle, misapply, steal, obtain by

                                 8
       fraud, false statement or forgery, or fail to refund any
       funds, assets, or property, shall be fined not more than
       $20,000 or imprisoned for not more than 5 years, or both,
       except if the amount so embezzled, misapplied, stolen,
       obtained by fraud, false statement, or forgery, or failed
       to be refunded does not exceed $200, then the fine shall
       not be more than $5,000 and imprisonment shall not exceed
       one year, or both.


20 U.S.C. § 1097(a) (emphasis added).                     Because the final clause of

§ 1097, emphasized above, limits the imprisonment term to one year

for    any    crime        falling    within       its    parameters,    it    has     been

characterized as the “misdemeanor exception.”                           See 18 U.S.C.

§ 3559(a) (classifying any crime for which the maximum term of

imprisonment exceeds one year as a felony, and any crime for which

the maximum term authorized is limited to one year or less as a

misdemeanor.).

       Bland argues that the plain language of the statute requires

that    she     be    sentenced       under    this       exception    “because       [her]

unperfected fraud procured zero dollars.”                      Appellant’s Br. at 8.

That is, because “the amount” she “obtained by fraud . . . d[id]

not exceed $200,” she was guilty only of a misdemeanor violation of

§    1097(a).        The    government,       however,      contends    that   the     same

language        unambiguously         renders        the     misdemeanor       exception

inapplicable to Bland’s attempted crime, because “[b]y its terms,

it    only    applies      when   a   person,       who    actually    receives      funds,

receives less than $200.”             Appellee’s Br. at 8.         Both Bland and the

government’s “plain language” interpretations lead to somewhat


                                               9
anomalous results. Under Bland’s theory, every attempted fraud, no

matter the intended loss amount, could only be punished as a

misdemeanor.    Conversely, under the government’s interpretation,

every unsuccessful attempt would be considered a felony and could

be punished with a maximum five-year prison term, even when a

successful attempt involving the same or lesser amount of money, so

long as less than $200, would be considered a misdemeanor with a

maximum sentence of one year imprisonment.

     Although the applicability of the misdemeanor exception to an

attempted crime under § 1097(a) appears to be an issue of first

impression for this court, as well as for the other circuit courts

of appeal, we need not resolve the issue here, because we find,

consonant with the district court, that Bland pleaded guilty to a

felony and that there exists a sufficient factual basis to support

her plea.    Notwithstanding Bland’s post hoc contention that she

“did not specifically agree to a felony plea,”          Appellant’s Br. at

2, the record plainly indicates that she did in fact plead guilty

to a felony and was aware of such both when she signed the plea

agreement and when she entered her plea in the district court.

     As the district court pointed out during Bland’s sentencing

hearing,    “[i]t’s   very   clear   from   the   provisions   of   the   plea

agreement” that the parties contemplated a felony plea.             J.A. 74.

First, the plea agreement provides that “[t]he maximum statutory

penalties to which Ms. Bland will be exposed by virtue of her plea


                                     10
of   guilty”    are    five-years’       imprisonment;       “a    fine   of    up   to

$250,000”; “up to three (3) years of supervised release”; and “a

special assessment of $100.00.”            J.A. 11-12.       Bland acknowledges,

as she must, that these are the maximum penalties for a felony

charge under § 1097(a).         If Bland were agreeing to plead guilty to

a misdemeanor, “the maximum statutory penalties to which [she]

w[ould] [have] be[en] exposed,” J.A. 11, were one year in prison

and a fine of up to five thousand dollars.                         See § 1097(a).

Further, if Bland had been pleading to a misdemeanor, she would

have   only    owed,   and    presumably      only   paid,    a    maximum     special

assessment fee of twenty-five dollars.                 Id.        Instead, she was

assessed, and paid on the date of her sentencing hearing, a fee of

one hundred dollars, which is charged only to individuals convicted

of a felony offense.          See 18 U.S.C. § 3013(a) (providing that any

individual convicted of an offense against the United States be

charged an amount from “$5 to $25” “in the case of an infraction or

a misdemeanor” and “$100 in the case of a felony”).

       The PSR also alerted Bland to the fact that she had pleaded

guilty to a felony by, again, listing the felony penalties as those

to which she would be subject, and by describing Bland’s offense as

a “Class D Felony.”          J.A. 117.    Notably, although Bland made four

objections to the PSR, she did not dispute the statutory maximums

or the classification of her offense as a felony.                  See J.A. 142-46.




                                         11
         The plea colloquy further demonstrates that Bland intended to

and understood that she was pleading guilty to a felony offense.

In fact, when this issue was raised at Bland’s sentencing hearing,

the court stated to Bland’s counsel, “I will be candid with you .

. . I was quite surprised to see that, particularly since I handled

the plea hearing[,] that you and Ms. Bland thought she was pleading

to   a    misdemeanor.”       J.A.    68.       The   court’s   bewilderment   is

understandable.       At the plea hearing, after having the government

summarize     the    terms   of    the   plea    agreement,     including   those

discussed above that plainly indicate that the parties negotiated

a felony plea, the court explained in detail each maximum penalty

for a felony violation of § 1097(a) and asked Bland whether she

understood that she would be exposed to such penalties.               At no time

during this extended colloquy did Bland’s counsel interject or

object; nor did Bland express any consternation or confusion.

Rather, she simply indicated her understanding, responding, “Yes,

ma’am.”       Plea   Hr’g    Tr.     19-20.      Significantly,    during    this

conversation the court specifically mentioned the word “felony,”

asking Bland whether she understood that there was “a one hundred

dollar mandatory special assessment that has to be paid for the

felony conviction.”          Id. at 20 (emphasis added).           Again, Bland

responded, “Yes ma’am.” Id. The classification of Bland’s offense

was also a key part of a later exchange between the court and

Bland’s counsel, when, after accepting Bland’s plea, the court


                                         12
asked whether Bland would “have any licensure issues now that she’s

tendered a plea of guilty to a felony.”        Id. at 39 (emphasis

added).   Again, there was no expression of shock, hesitation, or

mention of a misdemeanor charge.     Instead, Bland’s counsel simply

answered the question and the hearing concluded without further

discussion.

     These exchanges, combined with the contents of the plea

agreement, led the district court to find that Bland had pleaded

guilty to a felony offense and to further “find as a fact” that she

knew “exactly” that at the time she entered the plea.    We find no

error in these findings.3



                               III.

     Having determined that Bland pleaded guilty to a felony charge

under § 1097(a), the only remaining issue is whether her plea was

supported by a sufficient factual basis.4      Under Rule 11(b)(3),

“[b]efore entering judgment on a guilty plea, the court must

determine that there is a factual basis for the plea.”      Fed. R.



     3
      Because we conclude that Bland pleaded guilty to a felony and
therefore need not reach the statutory interpretation issue, we
likewise have no need to resolve her subsidiary arguments regarding
the proper calculation of the intended loss of her unperfected
fraud and the application of the rule of lenity.
     4
      Although Bland does not explicitly challenge the district
court’s finding of a sufficient factual basis for the plea, we
proceed prudentially and construe her argument as including such a
challenge.

                                13
Crim. P. 11(b)(3).      The district court in this case made such a

finding, which we review for abuse of discretion. United States v.

Martinez,    277 F.3d 517, 531 (4th Cir. 2002).     We cannot find error

“so long as the district court could reasonably have determined

that there was a sufficient factual basis based on the record

before it.”   United States v. Mastrapa, 509 F.3d 652, 660 (4th Cir.

2007).

     Bland was charged with, and pleaded guilty to, knowingly and

willfully attempting to obtain federal funds by fraud, false

statement, and forgery.       J.A. 6; see § 1097(a).   Blissman, the DOE

investigator, testified that through examination of the fraudulent

documents,    Bland’s   own    admission,   and   talking   with   Bland’s

accountant, he learned that Bland created a fraudulent audited

financial statement, copied it on a fabricated letterhead, forged

the accountant’s signature, and submitted the statement to the DOE

in an attempt to procure Title IV funds for her institution and its

students. Bland fully corroborated this testimony. If successful,

the district court found, Bland’s fraud and forgery would have

swindled the government out of approximately $50,000.          With this

record before it, the district court did not abuse its discretion

in finding a sufficient factual basis for Bland’s guilty plea.




                                    14
                               IV.

     Because Bland pleaded guilty to a felony offense under 20

U.S.C. § 1097(a), and there existed a sufficient factual basis to

support that plea, the judgment of the district court is

                                                           AFFIRMED.




                               15
