                   United States Court of Appeals,

                           Eleventh Circuit.

                             No. 94-4748.

           UNITED STATES of America, Plaintiff-Appellee,

                                   v.

  Nelson LOGAL, Aarid Dahod, a.k.a. Aarid Mansur Dahodwala, John
Kuczek, Defendants-Appellants.

                            March 6, 1997.

Appeal from the United States District Court for the Southern
District of Florida. (No. 93-6014 CR-SM), Stanley Marcus, Jr.,
District Judge.

Before HATCHETT, Chief Judge, DUBINA, Circuit Judge, and COHILL*,
Senior District Judge.

     DUBINA, Circuit Judge:

                       I. Statement of the Case

1. Factual History.

     In 1981, Howard F. Sahlen, Jr. ("Sahlen") founded a private

investigation and security firm called Sahlen & Associates, Inc.

("SAI").     Sahlen was chairman and chief executive officer of the

company through April of 1989.          In 1984, SAI became a publicly

traded company with its headquarters in Atlanta, Georgia.1
     As a publicly traded corporation, SAI was required to file a

registration statement with the Securities and Exchange Commission

("SEC")    detailing   certain   information    for   use   by   potential

investors.     In addition, SAI was required to file quarterly and


     *
      Honorable Maurice B. Cohill, Jr., Senior U.S. District
Judge for the Western District of Pennsylvania, sitting by
designation.
     1
      The headquarters were later relocated to Deerfield Beach,
Florida.
annual   reports    containing      financial         information     about    the

corporation's   worth     and   profit   levels.        Financial     statements

included in SEC filings must be audited, and between 1985 and 1989

SAI's annual reports were audited by the accounting firm of Peat

Marwick or its predecessor, Main Hurdman.

     Between 1983 and 1989, SAI's operation grew from one office

with 10 to 15 employees to about 100 offices with approximately

12,000 employees, and the company reported a tremendous increase in

revenues. Unfortunately, SAI achieved this growth by making public

stock offerings and obtaining bank loans through the use of false

financial documents.      SAI employees and others—including Sahlen,

Nelson Logal ("Logal"), Aarif Dahod ("Dahod"), and John Kuczek

("Kuczek")—used    various      means   to    misrepresent    SAI's    financial

condition, including check kiting, falsifying revenue figures in

financial statements, and creating false documents to support the

inflated revenue figures.         Sahlen, Logal, Dahod, and Kuczek also

devised and implemented various schemes to conceal the fact that

they had inflated and fabricated SAI's revenue figures.

     One of Sahlen's schemes to inflate revenue figures involved

the generation of false invoices and investigative files for

clients who were closely associated with Sahlen.             SAI listed these

accounts, which were never paid, under the heading of "special

accounts." P.J. Management—whose president, Logal, was a childhood

friend of Sahlen—enjoyed one of these "special accounts" with SAI.

Kuczek & Associates, an insurance brokerage company owned by

Kuczek, also had a "special account" during the 1987 fiscal year.

Dahod    was   actively    involved      in     the    generation     of      false
investigative files to authenticate the invoices, even going so far

as to create a computer program to facilitate the generation of

false documentation on a computer he called "Betsy."

       In order to disguise the financial instability of SAI, Sahlen

devised a check kiting scheme to give the illusion that SAI had the

funds      necessary   to   pay    operating   expenses.     Logal,   who    was

operating his own business in Ohio called N.H. Logal, assisted

Sahlen in the check kiting scheme by helping to deposit checks with

full knowledge that the checks were backed by insufficient funds.

In another scheme to conceal SAI's true fiscal status, SAI reported

non-existent revenue in a category called "work in progress."2

       The reporting of false revenue escalated substantially with

each       quarterly   report     filed   by   SAI,   ultimately   growing    to

$7,124,073.       The house of cards began to fall when auditors from

Peat Marwick started expressing concern about the large amount of

aging accounts receivable on SAI's books. Peat Marwick told Sahlen

that unless SAI began showing significant collections activities,

the accounts receivable figures would have to be discounted, which

would result in the reporting of much smaller income and revenue

figures.        To cover up the false revenue reported as accounts

receivable, the defendants created additional schemes.

       By the end of 1988, the amount of false revenue had grown to

millions of dollars, and most of the uncollected receivables were

fictitious.      In late March of 1989, Sahlen learned that the SEC was

investigating SAI's methods of reporting revenue.                  Sahlen also


       2
      "Work in progress" is an accounting device used to report
anticipated revenues from partially completed work.
learned that Peat Marwick auditors planned to visit SAI's Miami,

Florida, and Newark, New Jersey, field offices to examine files.

Upon completion of its investigation, the SEC sought federal

indictments against Sahlen, Logal, Dahod, and Kuczek.

2. Procedural History.

        A federal grand jury in the Southern District of Florida

returned a 29-count superseding indictment charging Logal, Dahod,

and Kuczek, as well as Sahlen, with various violations of federal

law.3       All four defendants were charged in count 1 with conspiring

to defraud the SEC and to commit securities fraud, bank fraud, and

mail fraud, in violation of 18 U.S.C. § 371, and in count 28 with

filing a false registration statement with the SEC on or about

March 14, 1989, in violation of 15 U.S.C. §§ 78m and 78ff(a) and 18

U.S.C. § 2. Logal, Dahod, and Sahlen were also charged with seven

counts of securities fraud, in violation of 15 U.S.C. §§ 78j(b) and

78ff(a), 17 C.F.R. § 240.10b-5 (Rule 10b-5), and 18 U.S.C. § 2

(counts 2-8);        eight counts of mail fraud, in violation of 18

U.S.C. §§ 1341 and 2 (counts 9-16);         six counts of filing false

reports and statements with the SEC, in violation of 15 U.S.C. §§

78m and 78ff(a) and 18 U.S.C. § 2 (counts 22-27);      and one count of

bank fraud, in violation of 18 U.S.C. §§ 1344 and 2 (count 29).

Logal was charged with one additional count of bank fraud (count

17), and Sahlen was charged with five additional counts of bank

fraud (counts 17-21).

        Sahlen pled guilty to all counts of the indictment, but Logal,

        3
      Additional defendants Theodore Leinweber, Paula Firebaugh,
and Tony Davis pled guilty before the return of the superseding
indictment and testified for the government at trial.
Dahod, and Kuczek proceeded to trial.            The district court granted

a motion for judgment of acquittal as to Dahod and Logal on count

9. The jury found Logal guilty of counts 1-8, 10-16, 22-25, and 29,

and not guilty of counts 17 and 26-28.           The jury found Dahod guilty

of counts 1-8, 10-16, and 24-29, and not guilty of counts 22 and

23.   The jury found Kuczek guilty of count 1 and not guilty of

count 28.

      Logal was sentenced to 60 months imprisonment as to count 1

and to 27 months of imprisonment as to the remaining counts, with

the   27-month    sentence    to    run   consecutively      to   the    60-month

sentence, for a total of 87 months of imprisonment.               The court also

ordered Logal to pay restitution totaling $59,338,184.                  Dahod was

sentenced to a total of 144 months imprisonment and ordered to pay

restitution in the amount of $59,338,184.              Kuczek was sentenced to

37 months imprisonment and a 3-year term of supervised release and

ordered   to     pay   a   fine    of   $4,000   and    restitution      totaling

$21,586,487.     Logal and Dahod are currently incarcerated.

      Kuczek is not incarcerated, however, because he committed

suicide the day before he was to begin serving his term of

imprisonment.      Following Kuczek's suicide, his counsel filed a

"suggestion of death" with this court and asked this court to

dismiss Kuczek's appeal as moot, to vacate Kuczek's sentence and

conviction in toto, and to remand the case to the district court

with instructions to dismiss the indictment.               This court ordered

that Kuczek's motions be carried with the case and instructed

Kuczek's counsel to address in his brief the effect of Kuczek's

suicide on the restitution order imposed by the district court. In
response to a motion for clarification, we specified that only

issues relating to the effect of Kuczek's death on the restitution
                                                         4
order should be addressed in Kuczek's appellate brief.       In his

brief, counsel for Kuczek requests that he be allowed to file a

brief presenting further challenges to the restitution order if

this court determines that it has jurisdiction to entertain the

merits of the appeal.

                        II. Issues Presented

1. Whether the district court abused its discretion by denying
     Logal's motions for severance from Kuczek.

2. Whether Dahod's allegations of prosecutorial misconduct warrant
     reversal of his and Logal's convictions.

3. Whether the district court abused its discretion by admitting
     challenged evidence.

4. Whether the district court abused its discretion by declining to
     give requested jury instructions.

5. Whether the district court abused its discretion in framing its
     response to a jury question.

6. Whether the district court properly sentenced Dahod and Logal.

7. Whether the restitution component of Kuczek's sentence survives
     his death.

8. Whether this court should dismiss Kuczek's appeal as moot,
     vacate his conviction and sentence, and remand this matter to
     the district court to dismiss the indictment.

                     III. Standards of Review

     Regarding all but the last three issues presented in this

appeal, we conclude that the defendants' arguments are meritless.

Accordingly, we affirm the defendants' convictions without further




     4
      Counsel for Kuczek complied fully with this court's
directives.
discussion. 5      We    also   affirm     without      discussion   all     of   the

sentencing      issues   raised    by    Dahod    and   Logal,   save   for   their

contention that the district court, in imposing their sentences,

violated     the   Ex    Post   Facto     Clause     of   the    Constitution     by

considering amendments to the United States Sentencing Guidelines

("U.S.S.G." or "guidelines") that went into effect after Dahod and

Logal's crimes had been completed. A defendant's claim that his or

her sentence was imposed in violation of the Ex Post Facto Clause

presents a question of law, and we review questions of law de novo.

See, e.g., United States v. Hooshmand, 931 F.2d 725, 727 (11th

Cir.1991).       The remaining issues—viz., whether the restitution

component of Kuczek's sentence survives his death, and whether this

court should dismiss the appeal as moot, vacate Kuczek's conviction

and sentence, and remand to the district court for dismissal of the

indictment—also present questions of law subject to de novo review.

See generally United States v. Asset, 990 F.2d 208 (5th Cir.1993);

United States v. Dudley, 739 F.2d 175 (4th Cir.1984);                         United

States v. Schumann, 861 F.2d 1234 (11th Cir.1988).

                                  IV. Discussion

1. Guidelines Issue.

         Although Dahod and Logal were sentenced in 1994, they were

sentenced    pursuant     to    the     pre1989    guidelines,     because    their

offenses had ended prior to the enactment of the 1989 amendments

and because those amendments included increases in the offense

levels for fraud cases.         See Miller v. Florida, 482 U.S. 423, 435-

36, 107 S.Ct. 2446, 2454, 96 L.Ed.2d 351 (1987).                  Both Dahod and

     5
      See 11th Circuit Rule 36-1.
Logal acknowledge that the district court imposed sentence on them

pursuant to the pre-1989 version of U.S.S.G. § 2F1.1. Nevertheless,

they argue that the district court violated the Ex Post Facto

Clause by looking to the 1989 amendment to § 2F1.1 for guidance in

determining the degree of their upward sentencing departures.

Because the court indisputably used the pre-1989 guidelines to

sentence Dahod and Logal, we conclude that no Ex Post Facto Clause

violation occurred.      Moreover, we note that six of our sister

circuits   have    already   approved   the   practice   of   looking   at

guidelines amendments that post-date applicable guidelines for the

purpose of determining the appropriate degrees of upward sentencing

departures.   See United States v. Harotunian, 920 F.2d 1040, 1046

(1st Cir.1990) (approving use of amended guideline to guide upward

departure);   United States v. Rodriguez, 968 F.2d 130, 140 (2d

Cir.) (same), cert. denied, 506 U.S. 847, 113 S.Ct. 140, 121

L.Ed.2d 92 (1992);    United States v. Bachynsky, 949 F.2d 722, 734-

35 (5th Cir.1991) (approving district court's consideration of

proposed amendments to § 2F1.1 in determining level of upward

departure), cert. denied, 506 U.S. 850, 113 S.Ct. 150, 121 L.Ed.2d

101 (1992);       United States v. Boula, 997 F.2d 263, 267 (7th

Cir.1993) (approving district court's consideration of amended §

2F1.1 to fashion upward departure and rejecting argument that doing

so constituted application of the amended guideline);              United

States v. Saffeels, 39 F.3d 833, 838 (8th Cir.1994) (holding that

"subsequent guidelines can be a useful touchstone in making the

determinations of reasonableness called for in upward departure

cases");   United States v. Tisdale, 7 F.3d 957, 967-68 (10th
Cir.1993) (holding that use of amended guideline to guide upward

departure is permissible so long as the district court understands

that the amended guideline provision is not controlling), cert.

denied, 510 U.S. 1169, 114 S.Ct. 1201, 127 L.Ed.2d 549 (1994).                 But

see United States v. Canon, 66 F.3d 1073, 1080 (9th Cir.1995)

(holding    that   district    court    erred   in   referring        to   amended

guideline to determine reasonable amount of upward departure).                  We

choose    to   adopt   the   majority   view    of   our     sister    circuits.

Accordingly, we affirm Dahod and Logal's sentences.

2. Restitution.

        Counsel for Kuczek asserts that the restitution order entered

by the district court cannot survive Kuczek's suicide.                Kuczek was

sentenced to serve a 37-month term of imprisonment and a 3-year

term of supervised release.       Additionally, Kuczek was ordered to

pay a fine of $4,000 and restitution totaling $21,586,487, pursuant

to the Victim and Witness Protection Act ("VWPA"), 18 U.S.C. §

3663.    Kuczek filed a notice of appeal, but the day before he was

to begin serving his sentence of incarceration, he committed

suicide.       Kuczek's appellate attorney argues that his client's

death rendered the entire conviction and sentence, including the

restitution order, void ab initio, and that the restitution order

is therefore without effect.

     This circuit has adopted the general rule that the death of a

defendant during the pendency of his direct appeal renders his

conviction and sentence void ab initio;              i.e.,   it is as if the

defendant had never been indicted and convicted. See United States
v. Pauline, 625 F.2d 684, 685 (5th Cir.1980)6;            United States v.

Schumann, 861 F.2d 1234, 1236 (11th Cir.1988). However, two of our

sister circuits have recognized an exception to the general rule of

abatement ab initio in cases in which a criminal sentence includes

an order that the defendant pay restitution to the victims of his

crimes.   See     United States v. Dudley, 739 F.2d 175, 177 (4th

Cir.1984);      United States v. Asset, 990 F.2d 208 (5th Cir.1993).

In   Dudley,    the   Fourth   Circuit   premised   its   holding   on   the

assumption that a restitution order is compensatory in nature.

That assumption is clearly at odds with our holding in United

States v. Johnson, 983 F.2d 216, 220 (11th Cir.1993), that "though

restitution resembles a judgment "for the benefit of' a victim, it

is penal, rather than compensatory."       Furthermore, any implication

that restitution resembles a civil judgment is undermined in this

court's opinion in United States v. Satterfield, 743 F.2d 827, 836

(11th Cir.1984), cert. denied, 471 U.S. 1117, 105 S.Ct. 2362, 86

L.Ed.2d 262 (1985).

      The Fifth Circuit's opinion in       United States v. Asset, 990

F.2d 208 (5th Cir.1993), is also distinguishable.          Asset held only

that an abatement did not disturb a voluntary restitution payment

made prior to the defendant's death.       Id. at 214.     This holding is

in accordance with our decision in Schumann where we amended

Pauline to hold that only fines not yet collected at the time of

death are abated.      Schumann, 861 F.2d at 1236.


      6
      In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th
Cir.1981) (en banc ), this court adopted as binding precedent all
decisions of the former Fifth Circuit handed down prior to
October 1, 1981.
        If we were to allow the restitution order to survive Kuczek,

a statutory problem would also arise. Title 18 U.S.C. § 3663(a)(1)

states that before the court can impose a restitution order, a

defendant must first be convicted of a crime.              Under the doctrine

of abatement ab initio, however, the defendant "stands as if he

never had never been indicted or convicted." Schumann, 861 F.2d at

1237.     The absence of a conviction precludes imposition of the

restitution order against Kuczek or his estate pursuant to § 3663.

     Moreover, a fundamental principle of our jurisprudence from

which    the   abatement    principle    is   derived    is   that   a   criminal

conviction is not final until resolution of the defendant's appeal

as a matter of right.       See Griffin v. Illinois, 351 U.S. 12, 18, 76

S.Ct. 585, 590, 100 L.Ed. 891 (1956).           As the Seventh Circuit has

stated, "when an appeal has been taken from a criminal conviction

to the court of appeals and death has deprived the accused of his

right to our decision, the interests of justice ordinarily require

that he not stand convicted without resolution of the merits of his

appeal...."     United States v. Moehlenkamp, 557 F.2d 126, 128 (7th

Cir.1977).       In   the   present     case,   Kuczek    appealed       both   the

conviction and the restitution order with the expectation that his

appeal would result in a reversal. To uphold the restitution order

against Kuczek, who has been denied the opportunity to properly

contest his conviction, violates the finality principle.

     Concerning the argument that the heirs of Kuczek's estate may

receive a windfall, nothing precludes the victims from bringing a

separate civil action to prevent any improper benefit to Kuczek's

estate.    Accordingly, we grant Kuczek's motion requesting that we
vacate his conviction and sentence, remand the case to the district

court, and instruct the district court to dismiss the indictment.

        AFFIRMED in part, VACATED in part, and REMANDED for further

proceedings consistent with this opinion.

     COHILL, Senior      District   Judge,   concurring   in   part   and
dissenting in part.

        I respectfully dissent from that portion of the opinion in

which a majority of the panel holds that Mr. Kuczek's death by

suicide, before his appeal was decided, necessitates the abatement

of the restitution order.    While United States v. Moehlenkamp, 557

F.2d 126, 128 (7th Cir.1977), states that a conviction can not

stand where "death has deprived the accused of his right to appeal

our decision," in this case the accused deprived himself of that

right by his own hand.      This situation is more analogous to the

scenario in which the appellant in a criminal case becomes a

fugitive;     in such a case, his appeal is lost.     Molinaro v. New

Jersey, 396 U.S. 365, 365-366, 90 S.Ct. 498, 498-499, 24 L.Ed.2d

586 (1970).    I believe that a narrow exception should be carved out

of the general abatement rule where an appellant takes his own

life.

     I join in the opinion in all other respects.
