from the United States District Court for the Western
District of Louisiana
JOLLY, ELROD, and WILLETT, Circuit Judges.
GRADY JOLLY, CIRCUIT JUDGE
Steven Blount, who pled guilty to securities fraud crimes, on
appeal challenges only his two-level sentencing enhancement
based on his violation of a prior administrative order. He
argues first that the order, handed down by the Financial
Industry Regulatory Authority (FINRA), is not an
administrative order within the meaning of §
2B1.1(b)(9)(C) of the Sentencing Guidelines. Second, he
argues that even assuming § 2B1.1(b)(9)(C) is applicable
to the FINRA order, he did not violate its terms. We hold
that, under the plain error standard of review, the district
court did not err in applying the § 2B1.1(b)(9)(C)
sentencing enhancement to the FINRA order and that Blount
clearly violated the order's terms.
practiced as a FINRA-licensed securities broker and dealer
from June 1992 through August 2003. During this period, he
was the subject of over one hundred customer complaints,
provoking FINRA to open a regulatory investigation. The
investigation concluded that Blount misrepresented material
information to investors, causing them to purchase unsuitable
financial products. Based on this finding, FINRA issued an
order banning Blount from associating with any FINRA member
"in any capacity." Because of FINRA's
jurisdiction over the brokerage industry, this order
effectively barred Blount from dealing in the securities
disregarded FINRA's order (and numerous other state and
federal securities laws and regulations along the way) and
resumed work as an investment advisor and securities broker
by at least the summer of 2007. Holding himself out as a
licensed securities broker, Blount orchestrated a Ponzi
scheme primarily targeting retirees. He promised his victims
high rates of return for investments in what turned out to be
fictitious securities. Instead of investing his victims'
capital, he placed it in various shell companies for his own
February 2014, FINRA forwarded a complaint to the Louisiana
Office of Financial Institutions alleging that Blount was
selling securities to the public in violation of its 2003
order. This complaint provoked a law enforcement
investigation which exposed Blount's Ponzi scheme.
Ultimately, Blount defrauded at least 72 investors out of
approximately $5.8 million.
federal government charged Blount with violating 18 U.S.C.
§ 1343 by committing wire fraud. Blount pled guilty. In
accordance with the plea agreement, he signed a stipulated
factual agreement admitting that the 2003 FINRA order barred
him from working as a securities broker. He also admitted
that "[d]espite his prohibition by FINRA, on a date not
later than June 1, 2007, Blount resumed operations as an
investment advisor and securities broker in violation of
state and federal securities laws and regulations." To
eliminate all doubt of the admission, Blount reaffirmed these
admissions during his plea colloquy:
District Court: In spite of your prohibition by FINRA . . .
you resumed operations as an investment advisor and
securities broker . . . . [I]s that what happened in this
Blount: Yes, ma'am.
Presentence Report (PSR) recommended several offense-level
adjustments, including a two-level increase under U.S.S.G.
§ 2B1.1(b)(9)(C) for violating a prior judicial or
administrative order. The district court overruled Blount's
objections to the PSR and sentenced him to 235 months of
imprisonment followed by three years of supervised release
and ordered him to pay $4, 313, 173.22 in restitution. He did
not directly appeal this sentence.
thereafter, however, Blount filed a motion in the district
court under 28 U.S.C. § 2255 to vacate, set aside, or
correct his sentence, arguing that his defense counsel was
constitutionally ineffective. The district court granted the
motion, vacated his sentence, and ordered a revised PSR and
new sentencing hearing. The revised PSR eliminated its
recommendation for an enhancement for abuse of trust but left
untouched the remainder of Blount's sentence, including
the two-level enhancement for violating an administrative
order. Blount objected to the revised PSR including its prior
order enhancement but failed to object on the grounds that
the FINRA order was not an administrative order within the
terms of § 2B1.1(b)(9)(C). The district court rejected
Blount's objection, holding ...