                               In the

    United States Court of Appeals
                 For the Seventh Circuit
                     ____________________
No. 14-1221


UNITED STATES OF AMERICA,
                                                   Plaintiff-Appellee,

                                 v.

SIAMAK S. FARD,
                                               Defendant-Appellant.
                      ___________________

         Appeal from the United States District Court for the
           Northern District of Illinois, Eastern Division.
            No. 1:09-cr-00247-1 — John F. Grady, Judge.
                     ____________________

   ARGUED DECEMBER 2, 2014 — DECIDED JANUARY 7, 2015
               ____________________

    Before WOOD, Chief Judge, and WILLIAMS and TINDER, Cir-
cuit Judges.

    WILLIAMS, Circuit Judge. Siamak S. Fard pled guilty to one
count of wire fraud pursuant to a blind plea. He later sought
to withdraw his plea, alleging that it was not knowingly and
voluntarily entered. The district judge conducted an eviden-
tiary hearing to determine whether Fard’s plea was based
2                                                  No. 14-1221

upon a representation by Fard’s original defense counsel
that the government had promised to dismiss the indictment
if Fard pled guilty and cooperated. At the hearing, counsel
denied having made such a statement. Rejecting Fard’s tes-
timony, the district judge credited counsel’s testimony and
denied Fard’s motion to withdraw his guilty plea. At sen-
tencing, the judge increased Fard’s guideline sentence, find-
ing that he had obstructed justice by lying at the evidentiary
hearing. He also denied Fard’s motion for an acceptance of
responsibility reduction, because Fard falsely denied his
leadership role in the scheme. Now, Fard seeks to withdraw
his guilty plea and challenges certain aspects of his sentence.
We find that Fard’s guilty plea was not knowing and volun-
tary, vacate his plea, and remand the case. Because we va-
cate Fard’s plea, we will not address the arguments regard-
ing his sentence.
                     I. BACKGROUND
    On March 17, 2009, a federal grand jury in the Northern
District of Illinois returned a three-count indictment charg-
ing Fard and two co-defendants with wire fraud in violation
of 18 U.S.C. § 1343. Fard entered a plea of not guilty, and the
government filed a superseding indictment on May 19, 2009,
charging two additional co-defendants and three additional
counts of wire fraud. In total, Fard was charged in four of
the counts and again entered a plea of not guilty. A second
superseding indictment was filed on May 25, 2010, after the
district court granted a co-defendant’s motion to dismiss for
vagueness, but the new counts did not pertain to Fard.
   The indictments were based upon an alleged mortgage
fraud scheme where the defendants obtained money and
property from mortgage lenders by means of false represen-
No. 14-1221                                                  3

tations. Fard and his co-defendants allegedly obtained near-
ly thirty loans in the names of nominees by submitting false
and fraudulent documents to the lenders. The nominees
would not have qualified for the loans if their applications
had been truthful. They usually did not live in the houses
which were purchased in their names and funds acquired by
the defendants were at times used to pay for improvements
on different properties from the ones for which they were
disbursed.
    Over the course of two and a half years, the trial date was
continued several times. In April 2011, Fard’s original coun-
sel filed a motion requesting that the district court appoint
him to continue representing Fard under the Criminal Jus-
tice Act, 18 U.S.C. § 3006A, since Fard could no longer afford
to pay him. The district court denied the motion, but we
could find no record of why the motion was denied.
    Trial was eventually set for October 18, 2011, but on Oc-
tober 17, defense counsel asked the court to continue the trial
for sixty days, because both the defense and the government
thought that Fard could provide significant cooperation and
were hoping to reach an agreement. The judge refused to
continue the trial beyond November 7, his next available
date. After giving counsel that date, the judge called for a
recess to allow the government, defense counsel, and Fard to
confer.
    After the break, defense counsel stated, “We are going to
change our plea to Count 3 with no agreement with the gov-
ernment at this time. We are entering, I guess we would call
it a blind plea to Count 3 of the indictment, Judge.” The
judge proceeded to read portions of the second superseding
4                                                  No. 14-1221

indictment and primary allegations. Then the following ex-
change occurred:
    Court: Do you follow me so far?
    Fard: Yes, I do.
    Court: And so far do you agree that you did all this?
    Defense Counsel: Judge, he agrees that he participat-
    ed in the scheme and he had knowledge of the
    scheme.
    The judge pressed Fard about the extent of his
“knowledge” by questioning defense counsel, to which
counsel responded, “[Fard] had knowledge of Nationwide
submitting these, permitting and submitting these phony
applications, and he knew it was going on, but he did noth-
ing about it, he just participated in the scheme as it went
along.” Nationwide was the lender Fard allegedly defraud-
ed.
    The judge then read from a draft, but unexecuted, plea
agreement, which spelled out the way in which the defend-
ants obtained mortgage loans in the names of nominees and
used the money for other projects. Whenever Fard spoke, he
resisted the allegations, at one point saying, “I mean, I did
not plan any scheme. We just tried to build typical American
dream to build and fix and sell and, you know, bring the
dream true, and just got involved with the wrong people.”
Defense counsel repeatedly said that Fard “participated”
and “had knowledge,” but that Fard did not want the court
to think he was the planner. Another break was held after
Fard stated that the lender, Nationwide, put together the
loan applications and knew about the misrepresentations.
No. 14-1221                                                 5

    The elements of wire fraud were never explicitly stated at
the plea hearing. Fard insisted throughout the hearing—
relevant portions of which we will quote in our later discus-
sion—that his intentions were honest and businesslike. De-
spite finding that it was “like pulling teeth” to get Fard to
admit guilt, the district judge accepted Fard’s plea.
    After entering his guilty plea, Fard met with the govern-
ment without his attorney to discuss cooperation. At the
meeting, government agents asked Fard to talk about his in-
volvement in the wire fraud scheme. Fard became agitated,
arguing that he did not do anything wrong. The meeting
ended without Fard providing any cooperation and he did
not meet with the government again. Instead he asked his
attorney to file a motion withdrawing his guilty plea.
   On November 10, 2011, Fard’s original counsel filed a
motion to withdraw as counsel and to withdraw Fard’s
guilty plea. The lawyer’s motion to withdraw as counsel was
granted and new counsel was appointed.
    New counsel filed a more detailed motion to withdraw
Fard’s plea, arguing that it was not knowingly and voluntari-
ly entered because Fard did not understand the nature of the
charge. The motion also alleged that Fard only entered into
the guilty plea because his original counsel told him that the
cooperation agreement with the government was conditional
on his willingness to enter a guilty plea that day and that if
he pled guilty, the government would provide Fard a mean-
ingful opportunity to provide anticipated cooperation by
working undercover. In an attached affidavit, Fard stated
that his original counsel had told him on the morning of his
change of plea hearing that the plea was just a formality and
the case would be dismissed after he cooperated with the
6                                                  No. 14-1221

government. The district judge decided that an evidentiary
hearing was needed to determine the nature of the alleged
conversations between Fard and original counsel on the day
of the change of plea hearing.
   On June 5, 2012, the evidentiary hearing was held. Origi-
nal counsel, Fard, and the case agent testified. Counsel de-
nied telling Fard on the day of the plea hearing that the gov-
ernment promised to dismiss the case if he pled guilty and
cooperated, but he did admit to jokingly telling Fard that the
indictment might be dismissed if Fard became a spy in Iran.
At the conclusion of the hearing, the district judge made a
credibility determination that counsel was telling the truth
and Fard was not. The judge denied Fard’s motion to with-
draw his plea and set a date for sentencing.
    Sentencing was continued many times, during which
Fard retained a third lawyer. He filed a third motion to
withdraw Fard’s guilty plea, which raised similar issues as
the previous motions, along with an ineffective assistance of
counsel claim. The motion was denied. On January 22, 2014,
Fard’s sentencing hearing was held. His pre-sentence report
calculated an offense level of 29. But the district judge found
Fard’s offense level to be 31 because he included a two-level
increase for obstruction of justice, based upon his finding
that Fard lied during the evidentiary hearing. Fard was also
denied an acceptance of responsibility reduction. With a
criminal history category of I, Fard’s Guideline range was
108–135 months. The judge ultimately sentenced Fard to 84
months in prison.
   On appeal, Fard once again seeks to withdraw his guilty
plea as unknowingly and involuntarily entered. He also
challenges the district judge’s sentencing decisions regarding
No. 14-1221                                                   7

the obstruction of justice enhancement and the denial of an
acceptance of responsibility reduction.
                        II. ANALYSIS
   Fard argues that his guilty plea was not knowing and
voluntary. He asserts that his plea fell short of the require-
ments of Federal Rule of Criminal Procedure 11 in two re-
spects. First, his plea colloquy did not comply with Rule 11
because he never understood the nature of the charge
against him, and second, the district judge did not ensure
that the plea was not based upon any undisclosed promises.
With respect to the first claim, Fard asserts that the district
judge failed to make sure that Fard understood the nature of
wire fraud and particularly that a wire fraud conviction re-
quired a specific intent to defraud.
    We review the district court’s denial of a defendant’s mo-
tion to withdraw a guilty plea for abuse of discretion. United
States v. Chavers, 515 F.3d 722, 724 (7th Cir. 2008). After a
guilty plea is accepted, a defendant may withdraw it if he
presents a “fair and just reason” for doing so. Fed. R. Crim.
P. 11(d)(2)(B). In reviewing the decision of the district court,
factual findings as to whether the defendant has presented a
“fair and just reason” are reviewed for clear error. Chavers,
515 F.3d at 724.
    “By pleading guilty to a criminal charge, a defendant
waives several fundamental constitutional guarantees. Be-
cause a defendant sacrifices these critical rights, both due
process and Rule 11 require that a defendant’s guilty plea be
made voluntarily and knowingly.” United States v. Fernandez,
205 F.3d 1020, 1024 (7th Cir. 2000). Rule 11 sets up many re-
quirements that are intended to assure that a defendant’s
8                                                  No. 14-1221

guilty plea is knowing and voluntary. One requirement is
that “before the court accepts a plea of guilty or nolo con-
tendere … the court must address the defendant personally
in open court … [and] the court must inform the defendant
of, and determine that the defendant understands, the na-
ture of each charge to which the defendant is pleading.” Fed.
R. Crim. P. 11(b)(1)(G). “Unless the defendant fully compre-
hends the elements of the crime to which he is confessing,
his plea cannot be said to have been knowingly and volun-
tarily entered.” Fernandez, 205 F.3d at 1025 (quotation and
citation omitted). A defendant does not have an absolute
right to withdraw a plea before sentencing, but the court
may allow him to do so if he has a “fair and just reason” for
doing so. Fed. R. Crim. P. 11(d)(2)(B); Chavers, 515 F.3d at
724. “A guilty plea taken without attention being given to the
matters set forth in Rule 11 could constitute a ‘fair and just’
reason justifying the request for withdrawal of a plea, and
the denial of a motion to withdraw under such a circum-
stance would be an abuse of discretion.” United States v. Le-
Donne, 21 F.3d 1418, 1423 (7th Cir. 1994).
    To determine whether the defendant fully understands
the nature of the charge to which he is admitting guilt, we
have adopted a totality of the circumstances approach. Unit-
ed States v. Pineda-Buenaventura, 622 F.3d 761, 770 (7th Cir.
2010). Under this approach, we consider “(1) the complexity
of the charge; (2) the defendant’s level of intelligence, age,
and education; (3) whether the defendant was represented
by counsel; (4) the district judge’s inquiry during the plea
hearing and the defendant’s own statements; and (5) the evi-
dence proffered by the government.” Id. (citing Fernandez,
205 F.3d at 1025).
No. 14-1221                                                    9

    Reviewing the record here in light of the relevant factors,
we cannot conclude that Fard was fully aware of the nature
of the crime to which he pled guilty. The guilty plea was
“enveloped in confusion and misunderstanding,” Fernandez,
205 F.3d at 1026, such that we cannot say with confidence
that Fard truly understood that a wire fraud conviction re-
quired intent to defraud.
    The first factor, complexity of the charge, “mitigate[s]
against a finding that [Fard] understood exactly what he was
pleading to.” Pineda-Buenaventura, 622 F.3d at 771. Fard pled
guilty to one count of wire fraud. A wire fraud conviction
under 18 U.S.C. § 1343 requires (1) a scheme to defraud; (2)
intent to defraud; and (3) use of wires in furtherance of the
scheme. United States v. Leahy, 464 F.3d 773, 786 (7th Cir.
2006). It is a specific intent crime. Id. To show the intent to
defraud, we have said that we require a “willful act by the
defendant with the specific intent to deceive or cheat, usual-
ly for the purposes of getting financial gain for one’s self or
causing financial loss to another.” Id. (quotation and citation
omitted).
     To a lay person, fraud may seem like theft. Laypeople,
including defendants, often think fraudulent intent requires
intent to take something from another person and not return
it, for one’s own benefit. See In re Katsman, 771 F.3d 1048 (7th
Cir. 2014) (noting defendant argued that she lacked fraudu-
lent intent because she did not seek to obtain any monetary
benefit). But fraud does not require that a defendant “con-
template[] harm to the victim or any loss.” Leahy, 464 F.3d at
787. In fact, “a defendant’s honest belief that his actions will
ultimately result in a profit and not a loss is [legally] irrele-
vant.” Id. As the government stated at oral argument, a per-
10                                                 No. 14-1221

son can commit fraud even when he intends to repay the
money obtained by the fraud. We believe that the illegal na-
ture of many fraudulent schemes, like many conspiracies,
will not be “immediately understandable to a layperson.”
Pineda-Buenaventura, 622 F.3d at 771. Fraudulent intent and a
fraudulent scheme are not terms with a simple and common
meaning. Cf. United States v. Wetterlin, 583 F.2d 346, 350 (7th
Cir. 1978) (conspiracy “is not a self-explanatory legal term or
so simple in meaning that it can be expected or assumed that
a lay person understands it”).
    With respect to Fard’s intelligence, age, and education,
Fard was an experienced businessman in the construction
industry. However, English was not his native language and
he is not a lawyer. He should be no more expected to under-
stand the meaning of “fraudulent intent” or a “fraudulent
scheme” than an average juryperson.
    The fact that Fard was represented by counsel “d[oes] not
alleviate the problems we perceive here,” Pineda-
Buenaventura, 622 F.3d at 771, particularly in light of Fard’s
second challenge to his plea, namely that his lawyer told him
that the government promised to dismiss his case if he pled
guilty. Fard and his original counsel clearly had a difficult
relationship and we cannot be assured that counsel ex-
plained the legal meaning of fraudulent intent to his client.
In fact, counsel’s own statements at the plea hearing suggest
that counsel knew Fard did not think he acted with fraudu-
lent intent. Counsel said “his intentions he still feels were
honorable and businesslike” and “[t]he intentions of what to
do with the money, and that’s where he’s confused, was
good.” By counsel’s own words then, Fard was confused
about the nature of the charges. At certain points, counsel
No. 14-1221                                                 11

attempted to clarify matters for the court, but his clarifica-
tion was couched in the words of “knowledge” and “partici-
pation”, not intent to defraud, and, regardless, “those at-
tempts are not a substitute for [Fard] himself actually indi-
cating an understanding of the charge to which he was
pleading.” Id.
    The fourth factor—the judge’s inquiry and the defend-
ant’s own statements during the plea hearing—is where this
plea runs into its biggest challenges. The court never ex-
plained what “intent to defraud” means or what a fraudu-
lent scheme is, and Fard never admitted to acting with intent
to defraud. A careful review of Fard’s colloquy demonstrates
that Fard was indeed confused about the concept of fraudu-
lent intent and was equivocal in many of his answers to the
court regarding his actions. For example, when the judge
asked Fard if the government’s proffer regarding how the
scheme worked was accurate, Fard responded “partial true.”
Cf. Fernandez, 205 F.3d at 1027 (vacating defendant’s guilty
plea and using defendant’s response “[n]ot all of the acts,
partially” to the question of whether he had done the things
set forth in the government’s proffer as evidence that de-
fendant was confused over the crime to which he was admit-
ting guilt). The court continued:
   Court: So you were using these nominees to avoid the
   appearance that you were the applicant—
   Fard: No, no, no. It was a partnership. The attorney
   recommended if we have partners, it will share the
   expenses, it will share the labor, and it will be also
   easier to obtain financing if you have multiple part-
   ners.
12                                                      No. 14-1221

Fard was unequivocal, both in his own statements and in
counsel’s statements on his behalf, in professing his good in-
tentions. In his exchanges with the court, Fard firmly resist-
ed admitting any intent to defraud. That is because, as coun-
sel stated, “it was more the lenders here that were letting this
stuff go for people who just wanted to run a business.” The
lenders were aware of and involved in setting up the
scheme. For example:
     Court: Now, did you participate in that scheme to de-
     fraud the lenders by submitting to them and causing
     them to rely upon these false loan applications which
     were false in the respects which are recited in the
     draft that I read?
     Fard: Your Honor, the lender was Nationwide Mort-
     gage Financial, which they put the whole thing to-
     gether. But I had acknowledgment, but I did not say
     anything against the lender. Lender is the one intro-
     duce these people to me to bring them as a partner.
     Lender was Nationwide Financial Mortgage, which
     they brought these people.
    It was at this point that the judge called for a break, rec-
ognizing that he was going to have to conclude that he did
not have a plea. He told defense counsel that in order for the
plea to be accepted, “you’ve got to get him to admit that he
at least participated in this scheme knowing that it was a
fraudulent scheme.” 1 In Pineda-Buenaventura, we suggested
that when a district judge faces a defendant resisting taking
responsibility at a plea hearing, the judge might want to take

     1Despite using the phrase “fraudulent scheme,” the judge did not
explain the meaning of a fraudulent scheme.
No. 14-1221                                                 13

a brief recess in the plea colloquy in order for defense coun-
sel and the defendant to confer and address a defendant’s
confusion. 622 F.3d at 772. At Fard’s hearing, the judge took
such a break. But the confusion continued. After returning
from the break, Fard explained in his own words what he
was pleading to, in a statement which was, at best, “non-
committal, vague, and evasive,” id.:
   Court: Mr. Fard, what do you plead guilty to?
   Fard: I participate and I had the acknowledgment of
   the partners probably their stuff was not kosher, the
   document was not kosher.
   Court: What do you mean probably?
   Fard: Like [defense counsel] said, the partner did not
   reside in the property.
   Court: You say “partner.” Do you mean these nomi-
   nees?
   Fard: Yes, Your Honor.
   Court: You knew that they were not qualified for
   these loans, if they told the truth about themselves?
   Fard: Yes.
   Court: Not what they intended to do. Did you know
   that?
   Fard: Yes, Your Honor.
   Court: All right. Now, did you know that the mort-
   gage proceeds were going to be used by you and per-
   haps others to acquire and make improvements on
   properties other than this Oakley Avenue property?
14                                                  No. 14-1221

     Fard: The mortgage, we did lots of improvement on
     that subject property, and we might use some of the
     money for another property, but we spent a lot of
     money on that particular property.
    And so it went on. The judge became so exasperated with
Fard’s unwillingness to admit fault that he said “It’s like
pulling teeth. I feel I ought to have a dental license this af-
ternoon.” Nonetheless the judge felt he had elicited enough
information for a plea on the intent and scheme to defraud,
without ever explaining fraudulent intent. We find that
“[b]ased on this record, it is impossible to ascertain precisely
what [intent] Fard admits.” Fernandez, 205 F.3d at 1027.
     The final consideration in our totality of the circumstanc-
es approach examines the government’s proffered evidence.
Examining this factor in Fernandez, we said that “[w]hile
there was nothing wrong with the AUSA’s factual proffer on
its face, the surrounding chaos at this change of plea hearing
significantly negated any confidence in Fernandez’ under-
standing of and admission to those facts.” Id.; see also Pineda-
Buenaventura, 622 F.3d at 772. Similarly here, the govern-
ment’s explanation of its evidence would probably be suffi-
cient to secure a normal guilty plea, but “this was anything
but an ordinary change of plea hearing.” Fernandez, 205 F.3d
at 1027. Before the hearing, Fard’s attorney had sought to be
appointed under the CJA because Fard could not afford to
pay him to go to trial, but the court, without any explanation
in the order, rejected the request. If Fard did not plead guilty,
trial was set to begin in a couple weeks. Neither the district
court nor the government ever explained the nature of
fraudulent intent on the record. Breaks were taken, but con-
fusion continued. And throughout the hearing, the words
No. 14-1221                                                 15

“knowledge” and “participation” were used, rather than “in-
tent” or “fraudulent.”
   “A defendant’s clear understanding of the nature of the
charge to which he is pleading guilty relates to the very
heart of the protections afforded by the Constitution and
Rule 11.” United States v. Bradley, 381 F.3d 641, 647 (7th Cir.
2004) (quoting Fernandez, 205 F.3d at 1027). So we cannot
conclude that the error in this case was harmless. Id.
    Fard also argues that his plea was not voluntary because
it was based on undisclosed promises. See Fed. R. Crim. P.
11(b)(2) (“Before accepting a plea of guilty or nolo contende-
re, the court must address the defendant personally in open
court and determine that the plea is voluntary and did not
result from any force, threats, or promises (other than prom-
ises in a plea agreement).”). Because we vacate Fard’s plea on
other grounds, we do not need to reach this argument. How-
ever, we note in passing that the district judge never asked
Fard whether his plea was based upon any undisclosed
promises. Fard’s claim is that his original attorney told him
that if he pled guilty, the government promised to dismiss
the indictment. While the district judge credited the lawyer’s
statements at the evidentiary hearing that he never told Fard
the case would be dismissed if he pled guilty, statements on
the record at the plea hearing indicate that such negotiations
may have been taking place. The plea hearing began with
defense counsel asking for a continuance because “we’ve en-
tered into some pretty serious negotiations with the gov-
ernment that involve extensive cooperation between my cli-
ent … involving undercover operations …. And basically
what we would like to see my client do is begin his coopera-
tion.” The government agreed that Fard could be in a posi-
16                                                  No. 14-1221

tion to “give historical cooperation” and “some active going-
forward type cooperation.” Counsel then stated, “Judge, if I
may, we were hoping that, depending how extensive this in-
volvement is and the cooperation is, that maybe one hope is
that we may b[e] able to avoid a plea altogether.” After the
judge refused the continuance and a break was given, coun-
sel stated that Fard was entering a blind plea to Count 3.
When the judge asked about the other counts in the indict-
ment, the government responded that “[t]his is a blind plea
with no promises in either direction.” It was at this point
that the judge could have asked Fard if he had been prom-
ised anything, but he did not. The government could have
also stated that, while negotiations were ongoing, the gov-
ernment had made no promise to continue negotiating. And
the government or the defense could have spoken up to alert
the judge after the factual basis was established that Fard
had not been asked about all the areas required by Rule 11.
See United States v. Polak, 573 F.3d 428, 432–33 (7th Cir. 2009)
(stating that it is the responsibility of the judge, prosecutor,
and defense counsel to ensure that a plea meets the require-
ments of Rule 11 and that district judges may want to utilize
a checklist to ensure that the requirements are satisfied at a
plea colloquy). We do not need to make a determination as
to whether Fard’s plea was based upon undisclosed promis-
es, but the record here suggests that Fard’s claim is not far-
fetched.
   Because we vacate Fard’s conviction, we do not address
the challenges that Fard raises to his sentence.
No. 14-1221                                           17

                   III. CONCLUSION
   For the foregoing reasons, we VACATE Fard’s conviction
and REMAND this case for further proceedings consistent
with this opinion.
