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Appeals from the United States District Court for the Northern District of Texas.
For UNITED STATES OF AMERICA, Plaintiff - Appellee (12-10883): Leigha Amy Simonton, Assistant U.S. Attorney, U.S. Attorney's Office, Northern District of Texas, Dallas, TX.
For LENDELL BEACHAM, Defendant - Appellant (12-10883): James Patrick Whalen, Whalen Law Office, Plano, TX.
For WILLIAM RANDOLPH TISDALE, Defendant - Appellant (12-10883): Seth Kretzer, Law Offices of Seth Kretzer, Houston, TX.
For UNITED STATES OF AMERICA, Plaintiff - Appellee (12-11209): Leigha Amy Simonton, Assistant U.S. Attorney, David Lee Jarvis, Assistant U.S. Attorney, U.S. Attorney's Office, Northern District of Texas, Dallas, TX.
For HUBERT JONES, III, Defendant - Appellant (12-11209): Mark A. Perez, Attorney, Dallas, TX.
HUBERT JONES, III, Defendant - Appellant (12-11209), Pro se, Bastrop, TX.
Before STEWART, Chief Judge, and BENAVIDES and OWEN, Circuit Judges.
PRISCILLA R. OWEN, Circuit Judge:
William Tisdale, Hubert Jones, and Lendell Beacham were convicted by a jury on various counts of conspiracy, wire fraud, and bank fraud. They appeal the sufficiency of the evidence supporting their respective convictions, various aspects of their respective prison sentences, and the district court's method of calculating restitution. We affirm their convictions but vacate their sentences and remand for resentencing.
In 2002, William Tisdale and former Dallas Cowboy Eugene Lockhart formed America's Team Mortgage (ATM) and KLT Realty (KLT). The evidence at trial indicated that Tisdale and Lockhart devised a " pass-through" real estate scheme. ATM/KLT would contract to purchase a property and, before obtaining title to the property, would almost immediately sell it to " straw" purchasers at a higher price. The straw buyers were individuals with good credit, who relied in part on the cachet of Lockhart's celebrity. ATM/KLT told these individuals that they would be buying properties as a once-in-a-lifetime investment opportunity. ATM/KLT provided the mortgage down payments and paid the straw buyers a bonus of up to $20,000 for each investment property he or she purchased. ATM/KLT also represented to the buyers that they were connected with individuals who desired to own property but needed to improve their credit scores. These individuals, ATM/KLT said, would rent the properties from the buyers, and the rental income would cover the monthly mortgage payments. Ostensibly, the renters would thereby improve their credit scores, and in time, be able to obtain a mortgage loan to purchase the properties from the straw buyers. However, ATM/KLT did not obtain renters, so there was no revenue generated for the straw buyers, and those buyers defaulted on the mortgages. The lenders foreclosed on the properties. ATM/KLT, however, profited.
In order to convince lenders to issue mortgages to the straw buyers, Tisdale, Lockhart, and others falsified loan documents, procured inflated property appraisals, and convinced the straw buyers to make misrepresentations in their mortgage applications. When the lender funded a loan to the straw buyer, the purchase price was paid to ATM/KLT, the original property owner was then paid the lower purchase price by ATM/KLT, and ATM/KLT kept the difference.
In late 2003, Tisdale and Lockhart dissolved their business association, and each formed new companies. Tisdale and Hubert " Trey" Jones, III, organized Atilla Capital and Pinnacle Realty, while Lockhart and Jermaine Frazier created Cowboys Mortgage. Atilla, Pinnacle, and Cowboys Mortgage continued the real estate pass-through scheme utilized by ATM/KLT.
In order to effectuate the scheme, Tisdale's and Lockhart's companies enlisted the participation of, and sometimes paid, members of the real estate industry to assist in the procurement of the loans. Lendell Beacham was among them. Occasionally, before approving a loan, a lender required the submission of a verification-of-rent form (VOR) to determine whether the borrower qualified. The VOR reflected the borrower's history of making monthly rental payments and therefore was an indication of the ability to make the monthly mortgage payments. Beacham, a licensed realtor and a landlord, provided VORs with falsified information at the request of Tisdale, Frazier, and Lockhart.
In 2009, Tisdale, Jones, and Beacham, along with eight co-defendants, were indicted
on charges of conspiracy, bank fraud, and wire fraud. Lockhart and five other co-defendants pleaded guilty. Tisdale, Jones, Beacham and two others proceeded to trial. The jury found Tisdale, Jones, and Beacham guilty of conspiracy to commit wire fraud in violation of 18 U.S.C. § 1349. Additionally, the jury convicted Tisdale and Jones of aiding and abetting bank fraud under 18 U.S.C. § 1344 and convicted both Beacham and Jones on separate counts of aiding and abetting wire fraud under 18 U.S.C. § 1343. Tisdale, Jones, and Beacham were each sentenced to serve a term of imprisonment.
The district court also ordered Tisdale, Jones, and Beacham to each pay restitution to the victims of the fraud. To calculate the amount of restitution, the district court reduced the original loan amount by any proceeds obtained through foreclosure. However, Tisdale, Jones, and Beacham objected to the use of the original loan amount for victims that purchased the loans on the secondary market. Without evidence of the mortgages' purchase prices on the secondary market, the district court ...