                 FOR PUBLICATION
 UNITED STATES COURT OF APPEALS
      FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA,                 No. 07-50105
                Plaintiff-Appellee,          D.C. No.
               v.                         CR-98-00118-
LANCE VAN ALSTYNE,                            AHS-1
             Defendant-Appellant.
                                           OPINION

       Appeal from the United States District Court
           for the Central District of California
      Alicemarie H. Stotler, District Judge, Presiding

                 Argued and Submitted
           March 9, 2009—Pasadena, California

                  Filed October 22, 2009

   Before: Michael Daly Hawkins, Marsha S. Berzon and
            Richard R. Clifton, Circuit Judges.

                 Opinion by Judge Berzon




                           14195
                UNITED STATES v. VAN ALSTYNE             14201




                         COUNSEL

James H. Locklin (argued), Sean K. Kennedy, Los Angeles,
California, for defendant-appellant Lance Van Alstyne.

Douglas F. McCormick (argued), Thomas P. O’Brien, Robb
C. Adkins, Santa Ana, California, for plaintiff-appellee the
United States of America.


                         OPINION

BERZON, Circuit Judge:

   Lance Van Alstyne appeals his conviction for money laun-
dering and the sentence imposed by the district court follow-
ing a limited remand. After Van Alstyne filed his appeal to
this court but before briefing, the Supreme Court decided
United States v. Santos, 128 S.Ct. 2020 (2008), which
addressed — with less than clear results, as will appear — the
meaning of the money laundering statute.

   Van Alstyne now argues that Santos requires us to reverse
his money laundering conviction. We agree in part. We hold
that Santos undermines our earlier approach to determining
whether funds arising from a specified illegal activity consti-
tute “proceeds” for the purposes of the money laundering stat-
ute, 18 U.S.C. § 1956, and requires a reversal of Van
Alstyne’s money laundering conviction for two of the three
money laundering counts. As to the third count, we affirm the
conviction as consistent with Santos. We agree with Van Al-
styne that the district court erred in calculating the enhance-
14202             UNITED STATES v. VAN ALSTYNE
ment to the money laundering sentence under U.S.S.G.
§ 2S1.1, in determining his fraud offense level under U.S.S.G.
§ 2F1.1(b)(1), and in imposing the restitution requirement,
and so remand for reconsideration of those portions of Van
Alstyne’s sentence.

      FACTS AND PROCEDURAL BACKGROUND

   Van Alstyne defrauded approximately 450 victims through
a Ponzi scheme involving a number of companies that he
organized for that purpose. The fraudulent scheme, begun in
1992, was built around thirteen oil and gas limited partner-
ships. These partnerships, LEM Pacific Income Fund I-IV,
Sandstone Gas Fund I-V, and American Gas Fund I-IV, were
controlled by Van Alstyne. Other companies he owned or
controlled, Liberty Energy Management and Sabre Asset
Management, served as the general partners for the limited
partnerships. Continental Mineral Acquisitions and Blake
Energy Corporation, two acquisition companies also owned
by Van Alstyne, purchased oil and gas properties on behalf of
the limited partnerships.

   Van Alstyne perpetuated the scheme by selling interests in
the limited partnerships to elderly and retired investors. Vic-
tims were solicited by brokers from Coastline Financial and
Merchant Banking Services, both of which were, at the time,
broker/dealers registered with the National Association of
Securities Dealers (NASD).1 Van Alstyne required the brokers
to adhere to a script that described a safe investment with a
more than ten percent annual return, backed by AAA-rated
government bonds. Only after making their initial investments
did the victims receive a printed prospectus disclosing that the
investments were in fact risky and that losses could result
from fluctuations in oil and gas prices. Nonetheless, because
  1
  Although Van Alstyne eventually acquired all the stock of Merchant
Banking Services, Coastline Financial was owned by Donald Williams.
Van Alstyne may have exercised some control over Coastline Financial.
                  UNITED STATES v. VAN ALSTYNE                  14203
victims received distribution checks shortly after making their
initial investments, they believed they had invested wisely
and often re-invested when contacted by brokers. In reality,
the distribution checks were largely funded not by oil and gas
revenues but by the investors’ own principal.2

   The scheme began to unravel in October 1994, when
NASD shut down Van Alstyne’s sales operation, Merchant
Banking Services. Although Van Alstyne’s agents continued
to peddle partnership interests, new investments slowed.
Shortly thereafter, Van Alstyne sent a letter to investors,
revealing that the distributions they had received so far were
not, in fact, oil and gas revenues, but instead a return of their
own principal. The letter explained that distributions were
made by refunding the investors’ principal “so that the distri-
butions could begin immediately rather than waiting until the
production proceeds were actually received.” Henceforth, the
letter indicated, investors would receive only their share of the
oil and gas revenue. Investors testified that when they con-
tacted Van Alstyne to address concerns his letter raised, he
reassured them that “everything was going to be all right” and
that investors could continue to expect distribution checks.
Distribution checks did in fact continue to arrive but at a
much slower pace — quarterly, instead of monthly — and in
vastly decreased amounts. Some of the complaining investors
received checks refunding some or all of their contributions,
although at least some were unable to cash the checks because
of insufficient funds.

  Van Alstyne was forced to cut back operations in 1995.
From then until 1998 investors received only sporadic distri-
bution checks, sometimes for amounts as low as a few cents.
In the end, the investors collectively invested more than $10
million in the limited partnerships and received a total distri-
  2
   Nor were the investments backed by safe government bonds. Zero-
coupon bonds with a maturity of thirty-eight years were bought for only
two of the limited partnerships and were sold within three months.
14204               UNITED STATES v. VAN ALSTYNE
bution of approximately $2 million. Van Alstyne made off
with more than $2 million in salary and payments from the
various companies he had set up to carry out this scheme.3

   In October 1998, a federal grand jury returned an amended
indictment charging Van Alstyne with nineteen counts of mail
fraud in violation of 18 U.S.C. § 1341 and three counts of
money      laundering     in   violation    of   18    U.S.C.
§ 1956(a)(1)(A)(i). The money laundering charges were based
on three specific transactions: Counts 20 and 21 involved
transfers of funds, one in January 1994 and one in June 1994,
from the acquisition company Blake Energy Corporation to
one of the limited partnerships. Trial testimony revealed that
these transfers were made for the purpose of making distribu-
tions to individual investors. Count 23 involved a transfer of
funds from Blake Energy to a limited partnership, executed in
November 1994 — that is, after the scheme began to unravel.
Testimony elicited at trial indicated that this transfer was
made to refund one investor’s entire outlay.

   In June 2001, after a three-week trial, a jury returned a
guilty verdict on seven of the mail fraud counts and all three
counts of money laundering. Van Alstyne was sentenced to a
290-month prison term (approximately 24 years), three years
of supervised release, a special assessment of $5,000, and res-
titution of more than $9 million. Van Alstyne appealed, and
this court affirmed his convictions and his sentence.4 United
States v. Van Alstyne, 87 Fed. Appx. 640 (9th Cir. 2004). The
Supreme Court subsequently granted Van Alstyne’s petition
for certiorari, vacated his sentence, and remanded for recon-
  3
     As the district court noted, this calculation leaves “several million dol-
lars [ ] unaccounted for.”
   4
     The judgment of conviction entered by the district court listed a prison
term of 300 months. This court issued a limited remand to the district
court for the sole purpose of amending the judgment to reflect the 290-
month sentence imposed orally. See United States v. Van Alstyne, 77 Fed.
Appx. 937 (9th Cir. 2003), superseded and corrected by United States v.
Van Alstyne, 89 Fed. Appx. 7 (9th Cir. 2004).
                 UNITED STATES v. VAN ALSTYNE             14205
sideration in light of United States v. Booker, 543 U.S. 220
(2005). See Van Alstyne v. United States, 543 U.S. 1116
(2005). On remand, this court affirmed Van Alstyne’s convic-
tions and remanded his sentence for reconsideration pursuant
to United States v. Ameline, 409 F.3d 1073 (9th Cir. 2005) (en
banc). United States v. Van Alstyne, 143 Fed. Appx. 45 (9th
Cir. 2005).

   Pursuant to the Ameline remand, the trial judge determined
that she would have imposed a materially different sentence
had the guidelines not been mandatory and resentenced Van
Alstyne to a 216-month prison term, three years of supervised
release, a special assessment of $500, and $9 million in resti-
tution. The new sentence required that, if any restitution
remains unpaid after Van Alstyne’s release, it shall be paid in
“nominal” monthly payments of $10,000 each, as “the court
finds that the defendant’s economic circumstances do not
allow for either immediate or future payment of the amount
owed.” Van Alstyne timely appealed.

                      II.    ANALYSIS

A.   Effect of Santos on Van Alstyne’s Money Laundering
     Conviction

   [1] Van Alstyne was convicted of three counts of money
laundering, in violation of 18 U.S.C. § 1956(a)(1). That sec-
tion provides, in relevant part:

     Whoever, knowing that the property involved in a
     financial transaction represents the proceeds of some
     form of unlawful activity, conducts or attempts to
     conduct such a financial transaction which in fact
     involves the proceeds of specified unlawful activity
     . . . with the intent to promote the carrying on of
     specified unlawful activity . . . shall be sentenced to
     a fine of not more than $500,000 or twice the value
     of the property involved in the transaction, which-
14206              UNITED STATES v. VAN ALSTYNE
      ever is greater, or imprisonment for not more than
      twenty years, or both.

18 U.S.C. § 1956(a)(1)(A)(i) (emphasis added).5 The statute
defines “specified unlawful activity” by enumerating certain
predicate offenses, including “any act or activity constituting
an offense listed in [18 U.S.C.] section 1961(1).” 18 U.S.C.
§ 1956(c)(7). Mail fraud, prohibited under 18 U.S.C. § 1341,
is one such listed offense. 18 U.S.C. § 19.

                                    1.

   We begin by closely examining the Santos decision, as it
is both the substantive and procedural predicate for Van Al-
styne’s challenge to the money laundering conviction.

   [2] The defendant in Santos operated an illegal lottery in
bars and restaurants in Indiana. Santos employed “runners” to
gather bets from gamblers and to deliver the funds to “collec-
tors.” The collectors in turn delivered the money to Santos,
who used some of it to pay the runners’ commissions, the col-
lectors’ salaries, and the lottery’s winners. Santos, 128 S.Ct.
at 2022-23. These payments to the runners, collectors, and
winners formed the basis of an indictment charging Santos
with both running an illegal gambling business and money
laundering. A majority of the Court held that the term “pro-
ceeds,” as applied to Santos’ offenses, refers to the “profits”
of the criminal activity, not to the operation’s “gross
receipts,” and that Santos’ payments to runners, collectors and
winners constituted regular expenses, rather than profits, of
the illegal gambling business. Id. at 2031.

   [3] Van Alstyne contends that his payments to investors
were no different than those held insufficient to sustain San-
tos’ money laundering conviction because the payments were
  5
   Unless otherwise indicated, all references are to the 2006 edition of the
U.S. Code.
                   UNITED STATES v. VAN ALSTYNE                     14207
“necessary for the operation to continue.” Our evaluation of
this argument is seriously hampered by the fact that there is
no majority opinion in Santos. Instead, there is a four-justice
plurality opinion, authored by Justice Scalia, and a concur-
rence by Justice Stevens, enunciating quite different reasoning
from that of the plurality. Addressing Van Alstyne’s argument
thus requires us to figure out the precedential impact of the
Supreme Court’s fractured analysis in Santos.

   [4] According to the Santos plurality, “proceeds,” left unde-
fined in § 1956, could mean either profits or gross receipts,
and the rule of lenity weighs in favor of the more defendant-
friendly profits definition. Santos, 128 S.Ct. at 2024-25. This
view of the statute was buttressed, according to the plurality,
by what it termed the “merger problem”: Functioning lotteries
will, presumably, pay their winners. Such payments from
gross receipts are intended to promote the illegal lottery.
Equating proceeds with gross receipts would therefore turn
nearly every violation of the illegal lottery statute, 18 U.S.C.
§ 1955, into a simultaneous violation of § 1956, the money
laundering statute, thereby “radically increas[ing]” the sen-
tence. Id. at 2026-27.6

   The four dissenting justices would have interpreted “pro-
ceeds” as “the total amount brought in,” id. at 2035 (Alito, J.,
dissenting), and leave the “so-called merger problem” to be
dealt with at sentencing. Id. at 2044.

   [5] Justice Stevens provided the fifth vote for the result
reached by the plurality — that Santos’ payments to lottery
winners and runners were not “proceeds” within the meaning
of the money laundering statute. Id. at 2033 (Stevens, J., con-
curring). But Justice Stevens rejected the plurality’s across-
the-board application of the rule of lenity, citing the legisla-
  6
   The illegal lottery statute provides for a sentence of up to five years,
18 U.S.C. § 1955(a). Violations of the money laundering statute are pun-
ishable with sentences up to twenty years. 18 U.S.C. § 1956(a)(1).
14208           UNITED STATES v. VAN ALSTYNE
tive history of § 1956 as evidence that Congress intended
“proceeds” to encompass gross revenues when the predicate
crime involved the sale of contraband. Id. at 2032 & n.3. Jus-
tice Stevens reasoned that “proceeds” may mean “profits”
with respect to one predicate crime and “receipts” with
respect to another, a result rejected by both the plurality and
the dissent. Id. at 2030, 2035-36.

   The Court was divided not only over the meaning of “pro-
ceeds” but also over the holding of the case, in light of the
fractured vote on the merits. Ordinarily, when “no single
rationale explaining the result enjoys the assent of five Jus-
tices,” the holding is limited to the narrowest grounds sup-
porting the result. Marks v. United States, 430 U.S. 188, 193
(1977). The plurality, minus Justice Thomas, insisted that the
holding of Santos under the Marks rule is that “ ‘proceeds’
means ‘profits’ when there is no legislative history to the con-
trary.” Santos, 128 S.Ct. at 2031. Justice Stevens disputed that
characterization of his own opinion, explaining that his con-
clusion was driven by the conviction that Congress could not
have intended the “perverse result” (the merger of the predi-
cate crime and the money laundering statute) that the receipts
definition would entail where the predicate crime was an ille-
gal lottery. Id. at 2034 n.7. The dissenters, seizing on Justice
Stevens’s discussion of organized crime and contraband,
observed that five justices would have applied the “gross
receipts” definition to these crimes. Santos, 128 S.Ct. at 2035-
36 & n.1.

   In light of this two-tier disarray, appellate courts have
struggled to glean what, if any, new rule of law the divergent
opinions of the Santos Court established. The Third Circuit
interpreted Santos broadly, as holding that “the term ‘pro-
ceeds,’ as that term is used in the federal money laundering
statute, applies to criminal profits, not criminal receipts,
derived from a specified unlawful activity.” United States v.
Yusuf, 536 F.3d 178, 185 (3rd Cir. 2008). The Eleventh Cir-
cuit took the opposite view, noting Santos’ “limited preceden-
                    UNITED STATES v. VAN ALSTYNE                     14209
tial value” and concluding that its “narrow holding . . . that
the gross receipts of an unlicensed gambling operation were
not ‘proceeds’ ” did not apply to a defendant who laundered
funds gained from illegal drug trafficking. United States v.
Demarest, 570 F.3d 1232, 1242 (11th Cir. 2009). The Fifth
Circuit noted that “the precedential value of Santos is unclear
outside of the narrow factual setting of that case, and the deci-
sion raises as many issues as it resolves for the lower courts.”
United States v. Brown, 553 F.3d 768, 783 (5th Cir. 2008).7

   Our circuit has mentioned Santos only in passing and in
doing so failed to note that the plurality view did not com-
mand a majority of justices: United States v. Lazarenko, 564
F.3d 1026 (2009), stated that the Supreme Court “concluded
that the term [‘proceeds’], left undefined in the statute, was
ambiguous as to whether it meant ‘profits’ or ‘receipts,’ and
so defined it in the more defendant-friendly terms of ‘profits,’
based on the rule of lenity.” Id. at 1039. In fact, the reasoning
described in Lazarenko was that of the plurality but not that
of Justice Stevens, who provided the fifth vote for reversing
the conviction. Lazarenko’s misdescription of Santos was in
no way relevant to our resolution of the Lazarenko case, and
so is not binding on us.8 While Lazarenko’s mischaracteriza-
  7
     In Brown, where the predicate crime was distribution of controlled sub-
stances, the court ultimately declined to reach the issue of Santos’ precise
parameters, holding instead that even if the plurality’s profits definition
governed this case, the defendants’ distribution of prescription drugs was
undoubtedly profitable and thus fit within that definition. Brown, 553 F.3d
at 784.
   8
     The panel in Lazarenko invoked Santos only for the purpose of “reaf-
firming the principle that when a term is undefined, we give it its ordinary
meaning.” Lazarenko, 564 F.3d at 1039 (internal quotation omitted). The
Lazarenko panel then distinguished the case at bar by noting that “extor-
tion,” unlike “proceeds,” has an unambiguous, common law meaning. Id.
Thus, Lazarenko correctly relied on Santos for the proposition that the
term “proceeds” is ambiguous, a view shared by a majority of justices.
The passing suggestion that the plurality’s specific definition of ‘proceeds’
applies beyond the facts of Santos was quite beside the point for which
Lazarenko relied on Santos.
14210              UNITED STATES v. VAN ALSTYNE
tion of Santos’ holding is thus dicta, it illustrates the difficulty
courts have encountered in turning the splintered Santos opin-
ions into an intelligible rule of law.

                                    2.

   [6] Before proceeding further to determine the import of
Santos for this case, we pause to address the government’s
assertion that this court’s earlier decision affirming Van Als-
tyne’s conviction precludes us from now considering the
impact of Santos. As the government recognizes, where a
defendant appeals after an Ameline remand, issues raised but
not decided on an earlier appeal are properly before the court.
United States v. Thornton, 511 F.3d 1221, 1226-27 (9th Cir.
2008). Although the defendant in Thornton sought review of
his sentence rather than his conviction, it is well settled that
“in the context of a criminal prosecution, finality is normally
defined by the imposition of the sentence.” United States v.
LaFromboise, 427 F.3d. 680, 683 (9th Cir. 2005) (internal
quotation omitted).9 We therefore hold that challenges to a
defendant’s conviction may be reviewed on appeal from an
Ameline remand, where, as in Thornton, the challenge was
raised in an earlier appeal.
  9
   LaFromboise considered the date on which a conviction becomes final
for the purposes of the deadline for filing a habeas petition under 28
U.S.C. § 2255. However, the proposition that a conviction does not
become final until the sentence is final is consistent across a spectrum of
caselaw addressing different facets of criminal law. See, e.g., Flanagan v.
United States, 465 U.S. 259, 263 (1982) (holding that the Court of
Appeals lacked jurisdiction to review order disqualifying counsel before
defendant had been tried and sentenced); Flynt v. Ohio, 451 U.S. 619, 620
(1981) (holding that the Supreme Court lacked jurisdiction to review Ohio
Supreme Court’s decision remanding for trial because the Court can only
review final judgments, defined by the imposition of a sentence); Berman
v. United States, 302 U.S. 211, 212 (1937) (“Final judgment in a criminal
case means sentence,” so a court’s suspension of the sentence did not ren-
der defendant’s appeal interlocutory.).
                   UNITED STATES v. VAN ALSTYNE                    14211
  In his previous appeal, Van Alstyne argued that insufficient
evidence existed to support his conviction, a claim we
reviewed de novo because Van Alstyne had timely moved for
judgment of acquittal. United States v. Van Alstyne, 87 Fed.
Appx. at 641. The panel rejected the insufficient evidence
contention. Id. at 642 (citing United States v. Sayakhom, 186
F.3d 928, 941 (9th Cir. 1999)). Van Alstyne is now again
appealing his conviction on insufficient evidence grounds,
maintaining that, given Santos, he could not be convicted of
money laundering.

   [7] Not surprisingly, the government contends that the law
of the case doctrine forecloses consideration of Van Alstyne’s
Santos argument.10 The law of the case doctrine provides that
“one panel of an appellate court will not as a general rule
reconsider questions which another panel has decided on a
prior appeal in the same case.” United States v. Scrivner, 189
F.3d 825, 827 (9th Cir. 1999) (quoting Merritt v. Mackey, 932
F.2d 1317, 1320 (9th Cir. 1991)). “The doctrine is a judicial
invention designed to aid in the efficient operation of court
affairs . . . not an inexorable command.” United States v.
Smith, 389 F.3d 944, 948-49 (9th Cir. 2004) (internal quota-
tions omitted). Moreover, “[a] court may depart from the law
of the case if . . . an intervening change in the law has
occurred.” Scrivner, 189 F.3d at 827.

   [8] Santos represents precisely the type of intervening
change that the law of the case exception recognizes. Before
Santos, Ninth Circuit precedent established that gross receipts
from a specified illegal activity always satisfied the “pro-
ceeds” prong of § 1956. See, e.g., United States v. Akintobi,
159 F.3d 401, 403 (9th Cir. 1998) (defining proceeds as “that
which is obtained . . . by any transaction”); United States v.
  10
     The government also cites the rule of mandate doctrine, but that doc-
trine applies to district court proceedings following remand, not to the
scope of a second appeal. See United States v. Thrasher, 483 F.3d 977,
981 (9th Cir. 2007), cert. denied, 128 S.Ct. 2052 (2008).
14212            UNITED STATES v. VAN ALSTYNE
Savage, 67 F.3d 1435, 1442 (9th Cir. 1995) (“The money that
investors sent to the Savage program constitutes the ‘pro-
ceeds’ of the mail fraud.”). Our across-the-board application
of the receipts definition plainly does not square with Santos,
which, at a minimum, requires us to apply the “profits” defini-
tion where the specified illegal activity is an illegal lottery,
and, depending on the view one takes concerning what rule
the fractured decision established, may apply to some set of
other statutes as well. To the extent our caselaw posited a uni-
form application of the “receipts” definition, it is inconsistent
with Santos.

   Moreover, Akintobi relied on dictionary definitions of “pro-
ceeds” to arrive at its conclusion that the term encompassed
all gross receipts from illegal transactions. See Akintobi, 159
F.3d at 403. Both the Santos plurality and Justice Stevens
rejected this line of reasoning as an authoritative interpretive
method with respect to this statute. See Santos, 128 S.Ct. at
2023-24 (opinion of Scalia, J.) (dictionary definition is ambig-
uous); id. at 2031-32 (opinion of Stevens, J.) (same). We are
“bound not only by the holdings of [the Supreme Court’s]
decisions but also by their mode of analysis.” Miller v. Gam-
mie, 335 F.3d 889, 900 (9th Cir. 2003) (en banc) (internal
quotations omitted). So, even if Santos does not clearly estab-
lish new law with respect to every predicate crime, it suffi-
ciently undercut Akintobi to require that we address anew the
meaning of “proceeds” in the money laundering context.

                               3.

   [9] We therefore inquire whether Santos established a new
rule of law that, as applied to Van Alstyne’s case, compels us
to conclude that there was insufficient evidence for his con-
viction. Having conducted that inquiry, we hold that Santos
requires reversal of two counts of Van Alstyne’s money laun-
dering convictions — those based on money transfers carried
out for the purpose of distributions to individual investors —
but not the third count, which involved a transfer for the pur-
                     UNITED STATES v. VAN ALSTYNE                       14213
pose of refunding the entire amount that one investor had
entrusted to Van Alstyne.

   [10] Only the desire to avoid a “merger problem” united the
five justices who held that Santos’ payments to winners and
runners did not constitute money laundering. Otherwise, Jus-
tice Stevens’ analysis diverged from that of both the plurality
and the principal dissent.11 But, as the plurality noted, “[t]he
merger problem is not limited to lottery operators. For a host
of predicate crimes, merger would depend on the manner and
timing of payment for the expenses associated with the com-
mission of the crime.” Santos, 128 S.Ct. at 2026 (plurality
opinion). We therefore view the holding that commanded five
votes in Santos as being that “proceeds” means “profits”
where viewing “proceeds” as “receipts” would present a
“merger” problem of the kind that troubled the plurality and
concurrence in Santos.12 The Sixth Circuit has also concluded
that the existence of a “merger” problem is central to the
meaning of “proceeds” after Santos. See United States v.
Kratt, 579 F.3d 558, 562 (6th Cir. 2009) (holding that pro-
ceeds “means profits only when the § 1956 predicate offense
creates a merger problem that leads to a radical increase in the
statutory maximum sentence and only when nothing in the
legislative history suggests that Congress intended such an
increase.”). See also United States v. Williams, 435 F.3d
1148, 1157 (9th Cir. 2006) (holding that to apply Marks,
“[w]e need not find a legal opinion which a majority joined,
  11
      See Santos, 128 S.Ct. at 2032 n.3 (Stevens, J.) (“I cannot agree with
the plurality that the rule of lenity must apply to the definition of ‘pro-
ceeds’ for [the sale of contraband].”); id. at 2030 (Scalia, J.) (rejecting Jus-
tice Stevens’ argument that “proceeds” could mean “profits” with respect
to operating an illegal lottery but “receipts” with respect to sale of contra-
band.).
   12
      We note that Congress subsequently amended the money laundering
statute to expressly define proceeds to include gross receipts. 18 U.S.C.
§ 1956(c)(9) (2009). Our task, therefore, is to determine how the Santos
Court would interpret “proceeds” with respect to mail fraud committed
prior to the statute’s amendment in May 2009.
14214           UNITED STATES v. VAN ALSTYNE
but merely a legal standard which, when applied, will neces-
sarily produce results with which a majority of the Court in
that case would agree.”) (citation and quotation omitted). See
also Smith v. Univ. of Wash. Law School, 233 F.3d 1188,
1200 (2000) (While a majority of Justices in Regents of the
Univ. of Cal. v. Bakke, 438 U.S. 265 (1978), would have per-
mitted academic institutions to take race into account, “Justice
Powell’s analysis is the narrowest footing upon which a race-
conscious decision making process could stand.”).

   [11] Our question, then, is whether mail fraud is, or can be,
a crime presenting the “merger” problem that was a fulcrum
consideration for the Santos plurality and concurrence. Mail
fraud has two elements: “(1) having devised or intending to
devise a scheme to defraud (or to perform specified fraudulent
acts), and (2) use of the mail for the purpose of executing, or
attempting to execute, the scheme (or specified fraudulent
acts).” Carter v. United States, 530 U.S. 255, 261 (2000); see
also Bridge v. Phoenix Bond & Indem. Co., 128 S.Ct. 2131,
2138 (2008). The Supreme Court has emphasized that 18
U.S.C. § 1341 prohibits “the ‘scheme to defraud’ rather than
the completed fraud. . . . ,” Neder v. United States, 527 U.S.
1, 25 (1999), and that a mailing need only be “incident to an
essential part of the scheme” to satisfy the second element.
Bridge, 128 S.Ct. at 2138.

   [12] In Van Alstyne’s case, issuing distribution checks that
supposedly represented generous returns on his victims’
investment was a central component of the “scheme to
defraud.” Doing so directly inspired investors to send more
money to Van Alstyne’s funds, which could then be used to
pay returns to other investors. The very nature of the scheme
thus required some payments to investors for it to be at all
successful. In sending the January and June distribution
checks funded by the money transfer that was charged as
money laundering, Van Alstyne “enter[ed] into a transaction
paying the expenses of his illegal activity,” Santos, 128 S. Ct.
at 2027 (plurality opinion). Convicting Van Alstyne of money
                 UNITED STATES v. VAN ALSTYNE              14215
laundering for the bank transfers inherent in the “scheme”
central to the mail fraud charges thus presents a “merger”
problem closely parallel to the one that underlay the majority
result in Santos.

   We recognize that not all mail fraud schemes will involve
payments that could implicate the “merger” problem. In
Bridge, for example, the mail fraud scheme hinged on the
defendants’ false attestations of compliance with a particular
rule for bidding on tax liens that deprived competing bidders
of a fair opportunity to participate in the auction. Bridge, 128
S.Ct. at 2136. The scheme itself required no payments.

   Santos suggests, however, that the “profits” definition of
“proceeds” should apply where the particular crime at issue
depends on necessary payments, as it does here. The plurality
noted that “any wealth-acquiring crime with multiple partici-
pants would become money-laundering when the initial recip-
ient of the wealth gives his confederate their shares,” Santos,
128 S.Ct. at 2026-27. The “merger” problem may therefore be
triggered when multiple participants share profits, regardless
of whether the predicate crime would overlap with money
laundering if executed by a single criminal. This language
indicates that our analysis of the “merger” problem in the mail
fraud context must focus on the concrete details of the partic-
ular “scheme to defraud,” rather than on whether mail fraud
generally requires payments of the kind implicated in Santos.

   [13] Moreover, all of the particular counts of mail fraud for
which Van Alstyne was convicted involved transmissions of
checks to investors, not the misrepresentations with which the
investments were first induced. The government is therefore
quite wrong to suggest that the mail fraud and money launder-
ing crimes are separate in the mail fraud context because “the
fraud was complete once the victim’s [sic] were induced to
part with their money based on defendant’s misrepresenta-
tions.” To the contrary, it appears that many, if not all, of the
fraud counts of which Van Alstyne was convicted could have
14216            UNITED STATES v. VAN ALSTYNE
been charged as money laundering as well, sharply illustrating
the “merger” problem.

   [14] The transaction in November that fully refunded one
investor’s outlay cannot, however, be regarded as a crucial
element of the “scheme to defraud.” The November 1994
transaction refunded the full amount invested by James and
Evelyn Easley, in response to their complaints after the
scheme began to unravel. The Ponzi scheme depended on
attracting new investments and using some but not all of the
amount collected to pay returns to earlier investors. Returning
the entire amount of the Easleys’ investment to them under-
mined rather than advanced the core scheme, as the funds
returned to them would not be available to lull other investors
into maintaining their investment. At the same time, returning
the Easleys’ investment was intended to “promote the carry-
ing on,” 18 U.S.C. § 1956(a)(1)(A)(i), of the “scheme” at the
heart of the mail fraud counts, by discouraging detection of
that scheme. As the mail fraud “scheme” and money launder-
ing elements are distinct with regard to this money laundering
count, we affirm that count.

  [15] In sum, we reverse Van Alstyne’s money laundering
conviction as to counts 20 and 21 but affirm as to count 22.

B.   Challenges to Van Alstyne’s Sentence

   Van Alstyne raises several objections to his sentence. We
review the interpretation of the sentencing guidelines de novo,
see United States v. Williamson, 439 F.3d 1125, 1137 n.12
(9th Cir. 2006), and review the district court’s factual findings
for clear error, United States v. Maldonado, 215 F.3d 1046,
1050 (9th Cir. 2000). We review the district court’s restitution
order for abuse of discretion, provided that it is within the
bounds of the statutory framework. See United States v. Gor-
don, 393 F.3d 1044, 1051 (9th Cir. 2004).
                   UNITED STATES v. VAN ALSTYNE                      14217
                                    1.

   Van Alstyne argues that the district court erred by imposing
an 8-level enhancement because “the value of the funds”
exceeded $6 million. See U.S.S.G. § 2S1.1 (1993).13 Van Al-
styne contends that the court erred by including in this amount
the distributions and refunds to investors, commissions to bro-
kers, and funds used to purchase oil and gas investments. The
government’s response is that even if Santos narrowed the
meaning of “proceeds,” the reference to “funds” in § 2S1.1
implies that all money associated with the scheme is to be
included for purposes of calculating the enhancement.

   [16] The term “funds” cannot be interpreted in a vacuum.
The Guidelines specifically refer to 18 U.S.C. § 1956 and
point out that the “statute covered by this guideline . . . pro-
hibits financial transactions involving funds that are the pro-
ceeds of ‘specified unlawful activity.’ ” U.S.S.G. § 2S1.1,
cmt. background. As later amendments clarified, the Guide-
lines impose enhancements based on the amount of funds that
were laundered within the meaning of the statute. See
U.S.S.G. § 2S1.1 (2008) & cmt. n.1 (conditioning the sentenc-
ing enhancement on the value of “laundered funds” and defin-
ing “laundered funds” as “the property, funds, or monetary
instrument involved in the transaction . . . in violation of 18
U.S.C. § 1956 . . . .”). Although the sentencing court could
take into account uncharged (and even acquitted) conduct that
constitutes money laundering, see United States v. Lawton,
193 F.3d 1087, 1094 (9th Cir. 1999); U.S.S.G. § 1B1.3(a)(2),
the Guidelines do not contemplate a base level enhancement
on account of transactions that do not constitute money laun-
  13
    Neither party disputes that Van Alstyne was properly sentenced pursu-
ant to the 1993 edition of the Guidelines. See Johnson v. Gomez, 92 F.3d
964, 968 (9th Cir. 1996) (if applying the version of the Guidelines in
effect at the time of sentencing would result in an ex post facto violation,
the district court must apply the version in effect at the time of the
offense).
14218              UNITED STATES v. VAN ALSTYNE
dering within the meaning of the statute. Therefore, transac-
tions that involve the payment of commissions, legitimate
purchases of oil and gas properties, and periodic distributions
to investors such as those involved in counts 21 and 22 may
not be considered for the purpose of calculating the guidelines
enhancement. Full refunds such as the one involved in count
23 are, however, properly considered under § 2S1.1.

                                    2.

   [17] Van Alstyne argues that the district court also miscal-
culated the offense level for the fraud counts.14 Under
U.S.S.G. § 2F1.1(b)(1), the offense level is adjusted based on
the amount of loss incurred because of the fraud. The district
court imposed a fifteen-level enhancement, based on a total
loss of more than $10 million. In arriving at the $10.7 million
figure, the district court relied on United States v. Munoz, 233
F.3d 1117, 1125-26 (9th Cir. 2000), which used a “risk theory
of loss” method to calculate the applicable amount. Applying
this method, the district court considered the total amount of
money invested by the scheme’s victims, without allowing for
offsets of amounts returned to investors through distribution
checks and refunds. Van Alstyne contends that a subsequent
amendment to the sentencing guidelines clarified the appro-
priate method for calculating losses in Ponzi schemes and
rejected the approach taken in Munoz, and that his sentence
should be vacated and remanded for calculation of the proper
Guidelines range for the fraud counts in light of the interven-
ing amendment. We agree.
  14
    Van Alstyne acknowledges that the higher offense level for the money
laundering counts determined his sentencing range under the Guidelines.
The offense level for the money laundering counts was 37, which included
an eight level increase because the value of the laundered funds was calcu-
lated to exceed $6 million. Our conclusion that the eight level increase
must be reversed, see supra Part II.B.1, raises the possibility that the
money laundering sentence could, on remand, be lower than the adjusted
offense for the fraud counts, which was 33. As sentencing issues with
respect to Van Alstyne’s fraud convictions could thus arise on remand, we
address those arguments here.
                UNITED STATES v. VAN ALSTYNE              14219
   In 2001, Amendment 617 revised several guidelines sec-
tions relating to economic crimes. See United States v. Mor-
gan, 376 F.3d 1002, 1011 (9th Cir. 2004). Among other
changes, the amendment added the following language:

    In a case involving a fraudulent investment scheme,
    such as a Ponzi scheme, loss shall not be reduced by
    the money or the value of the property transferred to
    any individual investor in the scheme in excess of
    that investor’s principal investment (i.e., the gain to
    an individual investor in the scheme shall not be
    used to offset the loss to another individual investor
    in the scheme).

U.S.S.G. § 2B1.1, cmt. n.3(F)(iv) (2008). This language only
prohibits reductions for any profits made by investors in
Ponzi schemes, not directly addressing whether the amount of
loss should be reduced by any partial return of a victim’s
investment. The notes accompanying the amendment, how-
ever, make clear that the implication of the new standard is
that returns to investors up to the amount invested do not
count as losses, and that Munoz is thus no longer good law.

   The Commission explained that the amendment “resolves
a circuit conflict regarding whether and how to credit pay-
ments made to victims,” U.S.S.G. App. C at 690 (2008),
referring to decisions by the Second, Fourth, and Fifth Cir-
cuits that essentially adopted the “risk of loss” theory applied
in Munoz: “Compare . . . United States v. Deavours, 219 F.3d
400 (5th Cir. 2000) (intended loss is not reduced by any sums
returned to investors).”. Id. The Commission then cited
United States v. Holiusa, 13 F.3d 1043 (7th Cir. 1994), which
held, in the words of the Commission, “that only the net loss
should be included in loss, thus allowing a credit for returned
interest,” and United States v. Orton, 73 F.3d 331 (11th Cir.
1996), which provided that payments to losing investors could
be credited, but not payments to investors who profited. The
Commission went on to state unequivocally that the amend-
14220              UNITED STATES v. VAN ALSTYNE
ment adopts the approach in Orton. U.S.S.G. App. C at 690
(2008). The language of the amendment appears designed to
differentiate Orton from Holiusa, which permitted Investor
X’s net gain to offset Investor Y’s net loss, and so to rest on
the Overton principle that payments to losing investors up to
the amount of their investment do not count as losses. See
United States v. Setser, 568 F.3d 482, 497 (5th Cir. 2009)
(holding that the amendment in question superseded
Deavours). We therefore hold that Munoz has been super-
seded by the amended § 2B1.1 and that the rule of Orton now
applies.

   [18] We further hold that the amendment clarifies, rather
than substantively alters, the Guidelines and therefore must be
applied to Van Alstyne on remand. See United States v.
Aquino, 242 F.3d 859, 865 (2001). Relevant factors in consid-
ering whether an amendment is substantive or clarifying
include “(1) whether the amendment is included on the list of
retroactive amendments found in U.S.S.G. § 1B1.10(c); (2)
whether the Commission itself characterized the amendment
as a clarification; and (3) whether the amendment resolves a
circuit conflict.” Morgan, 376 F.3d at 1011. In Morgan, we
noted that “the Commission clearly did not intend Amend-
ment 617 to be applied retroactively in its entirety,” and so
“look[ed] to the circumstances surrounding the relevant
guideline and its amendment” to determine whether the appli-
cation note at issue was clarifying or substantive. Id. at 1011-
12 (internal quotation omitted). We held that “the Commis-
sion’s efforts to resolve a circuit conflict, and a reasoned and
reasonable conflict at that . . . weighs heavily in favor of con-
cluding that the amendment is a clarification.”15 Id. at 1013.

   Here too, the change was made for the express purpose of
resolving a conflict among the circuits that resulted from rea-
sonable though differing interpretations of the Guideline. We
  15
     As in this case, the amendment in Morgan changed the law of this cir-
cuit. See Morgan, 376 F.3d at 1013.
                  UNITED STATES v. VAN ALSTYNE                   14221
therefore conclude that the amendment must be applied retro-
actively. See United States v. Alfonso, 479 F.3d 570, 572 (8th
Cir. 2007) (“[T]he parties agree that [Application Note
3(F)(iv)] was properly relied upon because it simply clarified
the meaning of the term ‘loss.’ ”). Accordingly, in recalculat-
ing the fraud offense level on remand, the district court shall
reduce the amount of loss by the amount of funds returned to
investors up to the amount invested, but not by the amount,
if any, of any profit made by any investors.

                                  3.

   [19] Van Alstyne also challenges the imposition of a four-
level enhancement premised on the district court’s conclusion
that he derived more than $1 million in gross receipts from an
offense that affected a financial institution. Under the 1993
edition of the guidelines, the offense level is increased by four
levels where the offense “affected a financial institution and
the defendant derived more than $1,000,000 in gross receipts
from the offense.” § 2F1.1(b)(6)(B) (1993) (emphasis added).
The applicable provision was modified in 2001 to read, “if . . .
the defendant derived more than $1,000,000 in gross receipts
from one or more financial institutions as a result of the
offense, increase by 2 levels.” U.S.S.G. § 2B1.1(b)(14) (2008)
(emphasis added).16 The Commission offered the following
explanation of the change:

       The enhancement also was modified to address
       issues about what it means to “affect” a financial
       institution and how to apply the enhancement to a
       case in which there are more than one financial insti-
       tution involved. Accordingly, the revised provision
       focuses on whether the defendant derived more than
       $1,000,000 in gross receipts from one or more finan-
       cial institutions as a result of the offense.
  16
    Van Alstyne concedes that the change from a four- to a two-level
enhancement is a substantive amendment that does not apply retroactively
to him.
14222           UNITED STATES v. VAN ALSTYNE
U.S.S.G. App. C at 685 (2008). Van Alstyne notes that he
received only $39,000 from a financial institution, Coastline
Financial. Thus, if the amendment applies, Van Alstyne’s
offense level should not have included the additional four-
level enhancement.

   [20] Once again, the issue is whether the 2001 amendment
to former Guideline § 2F1.1(b)(6)(B) was clarifying or sub-
stantive. The circuits that have addressed this question have
concluded that the amendment is substantive and may not be
applied retroactively. See United States v. Amico, 573 F.3d
150, 151 (2d Cir. 2009); United States v. Monus, 356 F.3d
714, 718 (6th Cir. 2004); United States v. Swanson, 360 F.3d
1155, 1166-67 (10th Cir. 2004); United States v. Hartz, 296
F.3d 595, 599 (7th Cir. 2002). We agree. The plain language
of the earlier version unambiguously conveyed that it applied
if the offense generated more than $1 million from any source
and also affected a financial institution; under this language
any impact on a financial institution would do. See United
States v. Greene, 212 F.3d 758, 761 (3rd Cir. 2000) (holding
that these two elements were “separate and distinct prerequi-
sites”). The amended language makes equally clear that the
enhancement only applies if gross receipts in excess of $1
million are derived from a financial institution. See Hartz, 296
F.3d at 599. Under this language, the only effect on a finan-
cial institution that counts is money flowing from a financial
institution into the defendant’s coffers. As there was a sub-
stantive change from the time he committed the offense, Van
Alstyne may not take advantage of the more lenient sentenc-
ing guideline on remand.

                               4.

   Van Alstyne raises his objection to the restitution ordered
for the first time on appeal. We therefore review the restitu-
tion aspect of the sentence for plain error. United States v.
Olano, 507 U.S. 725, 732 (1993) (a court may reverse when
the error is plain, “affects substantial rights,” and “seriously
                   UNITED STATES v. VAN ALSTYNE                    14223
affects the fairness, integrity or public reputation of judicial
proceedings”) (internal citations and alterations omitted). Van
Alstyne contends that the district court erred in calculating the
restitution amount and in ordering monthly payments of
$10,000. We agree.

   [21] Van Alstyne argues, and the government apparently
agrees, that a mathematical error resulted in an improper cal-
culation of the total restitution owed. We so hold. The presen-
tence report arrived at the total amount owed by deducting
$1,536,180 that had been distributed to investors from Van
Alstyne’s gross receipts of $10,737,000. This calculation
ignored an additional $332,308 in distributions and $756,791
in refunds made after the scheme began to unravel in 1995.
The total amount of restitution ordered should have been
$8,111,721.

   [22] The court also erred in ordering $10,000 monthly resti-
tution payments. At the time of Van Alstyne’s charged
offenses, the Victim Witness Protection Act (VWPA) pro-
vided that “[t]he court, in determining whether to order resti-
tution . . . shall consider the amount of the loss sustained by
any victim as a result of the offense, the financial resources
of the defendant [and] the financial needs and earning ability
of the defendant and the defendant’s dependents.” 18 U.S.C.
§ 3664(a) (1994).17 The presentence report indicates that at the
time of sentencing Van Alstyne’s monthly income was $5 to
  17
    All of the charged offenses occurred before the enactment of the Man-
datory Victim Restitution Act, which amended §§ 3663 and 3664, took
effect in 1996, although the fraudulent scheme continued for some time
thereafter. Presumably as a result, this appeal has been litigated by both
parties on the assumption that the 1996 amendments do not apply, and we
proceed on that basis as well.
   In addition to the VWPA, the Pre-Sentence Report and the District
Judge relied on the authority of the Senior Citizens Against Marketing
Scams Act of 1994 (SCAMS), 18 U.S.C. § 2327 (1994), to order restitu-
tion. As Van Alstyne notes, and the government does not dispute, SCAMS
is not applicable here.
14224              UNITED STATES v. VAN ALSTYNE
$25 and that he was liable for a civil judgment of $1,530, a
$210,642 tax lien, $10,781 in late child support payments, and
almost $700,000 in restitution payments to victims pursuant
to a NASD proceeding. Van Alstyne has a high school educa-
tion and limited work experience. He filed for bankruptcy in
the early 1990s.

   [23] Based on this information, the district court found that
“the defendant’s economic circumstances do not allow for
either immediate or future payment of the full amount.” The
court nonetheless ordered Van Alstyne to make “nominal”
restitution payments of $10,000 per month during the three-
year period of supervised release following his release from
prison. Ten thousand dollars per month cannot be called
“nominal.” See Cummings v. Connell, 402 F.3d 936, 943 (9th
Cir. 2005) (nominal damages “customarily are defined as a
mere token or ‘trifling’ ”).18 Nor does the record provide any
basis for concluding that Van Alstyne will be able to afford
to pay $10,000 per month following his release.

   We recognize that the VWPA “does not require express
findings on [the defendant’s resources and earning ability]
and grants the district court broad discretion in the kind and
amount of evidence.” United States v. Ramilo, 986 F.2d 333,
335 (9th Cir. 1993). Nonetheless, “at the time restitution is
ordered, the record must reflect some evidence the defendant
may be able to pay restitution in the amount ordered in the
future.” Id. at 336 (emphasis added).

   The only possible bases for concluding that Van Alstyne
   18
      Cummings defined “nominal” in the context of damages for vindicat-
ing constitutional rights when no quantifiable injury is proven, rather than
in the restitution context; nonetheless, its characterization of the term is
instructive.
   We do not disturb the portion of the restitution order requiring Van Al-
styne to pay at least $25 per quarter during his prison term, an amount that
is accurately characterized as “nominal.”
                UNITED STATES v. VAN ALSTYNE              14225
was capable of satisfying the $10,000 monthly payments are
observations in the original Presentence Report that “several
million dollars remain unaccounted for” and that Van Alstyne
had the motive to conceal funds acquired through the Ponzi
scheme. The court made no finding, however, that Van Als-
tyne actually still had access to the monetary fruits of his
crime, nor did the court indicate that it disbelieved the finan-
cial information Van Alstyne submitted at resentencing.
Indeed, if the court believed that Van Alstyne retained mil-
lions of dollars from his fraudulent scheme, there would have
been no reason to delay the $10,000 monthly payments until
after his release. Moreover, unsupported speculation that a
defendant has secreted funds would not constitute an evidenti-
ary basis for assessing the defendant’s ability to repay.

   [24] “A district court’s failure to make a restitution order
with which a defendant could possibly be expected to comply
threatens respect for judicial orders generally.” United States
v. Bailey, 975 F.2d 1028, 1032 (4th Cir. 1992). On remand,
the court shall recalculate the total amount owed and either
order restitution amounts that are truly “nominal” or identify
some evidence in the record that indicates Van Alstyne’s abil-
ity to pay a higher monthly amount upon release.

                    III.   CONCLUSION

  [25] Counts 21 and 22 of Van Alstyne’s conviction are
REVERSED, count 23 is AFFIRMED, and his sentence is
VACATED and REMANDED.
