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United States v. Greany

United States District Court, District of Massachusetts

August 25, 2014

UNITED STATES OF AMERICA
v.
MARIE GREANY

ORDER

RYA W. ZOBEL UNITED STATES DISTRICT JUDGE

Marie Greany pled guilty to one count of wire fraud. 18 U.S.C. § 1343. She was sentenced to one year and one day in prison and ordered to pay $74, 123.17 in restitution. The government now seeks an order requiring Greany to pay an additional $17, 016 in accounting fees and $822 in legal fees pursuant to the Mandatory Victims Restitution Act (“MVRA”) (Docket # 20). Id. § 3663A. Greany resists as to the accounting fees.[1] The motion is ALLOWED.

The MVRA requires a restitution order to “reimburse the victim for . . . other expenses incurred during participation in the investigation or prosecution of the offense.” Id. § 3663A(b)(4). The First Circuit has established a three-part test to determine whether an expense qualifies under this subsection. Defendant must make restitution for an expense if it (1) would not have been incurred in absence of the offense; (2) was not too far attenuated in fact or time from the crime; and (3) was reasonably foreseeable. United States v. Janosko, 642 F.3d 40, 42 (1st Cir. 2011) (quotations and citations omitted). I am “not held to a standard of absolute precision” when I apply the test. United States v. Salas-Fernandez, 620 F.3d 45, 48 (1st Cir. 2010). Just “a modicum of reliable evidence” in support of the restitution amount will do. Id. (internal quotation and citation omitted); see also id. (stating the restitution award “must have a rational basis in the record” but the court need not “recite book and verse in making [the] award”).

Elizabeth M. Gelson (“Gelson”), a Certified Public Accountant and Tax Principal for Untracht Early LLC, performed the forensic accounting.[2] As described in an affidavit, Gelson acquainted herself with the operations of the businesses and examined their bank statements, canceled checks, credit card statements, payroll registers, financial statements, and tax returns, with the goal of separating legitimate from illegitimate charges. Affidavit of Elizabeth M. Gelson, Docket # 20-1, at ¶¶ 4(a)-(d). She also spoke with company accounting staff and participated in discussions between Tom Gelson and the relevant banks and credit card companies. Id. ¶¶ 6-7. She recorded her time by making handwritten notes on an accounting ledger.[3] The entries on the ledger indicate the specific task Gelson performed and the amount of time she spent on that task. All told, Gelson spent 48.25 hours on the account. The $17, 106 the government requests is the number of hours multiplied by Gelson’s $425 per hour rate, less a $3, 500 “courtesy discount.”

This evidence satisfies the three-part test. There would be no need for a comprehensive forensic accounting had Greany not stolen from the victim businesses. According to the Presentence Investigation Report (“PSR”), Greany’s theft continued through September 2012. PSR ¶ 7. Gelson began her review in January 2013, a short time later. Gelson Aff. ¶ 4. And nothing in the record suggests Gelson’s review strayed from the offense. See United States v. Edwards, No. 13-10314-WGY, 2014 WL 2002844, at *7-*8 (D. Mass. May 16, 2014) (confirming that accountants’ fees are recoverable under the MVRA but declining to award them because the government did not adequately connect them to the criminal offense and subsequent prosecution). Finally, it was plainly foreseeable that once they uncovered the theft, the victim businesses would desire to determine the extent of the loss and seek an accountant’s help in so doing. See Janosko, 642 F.3d at 42. I conclude, as have five circuits who have considered the question in similar cases, that Gelson’s accounting fees are “other expenses incurred during participation in the investigation or prosecution of the offense” for which Greany must pay restitution under the MVRA.[4] 18 U.S.C. § 3663A(b)(4); see United States v. Elson, 577 F.3d 713, 728 (6th Cir. 2009); United States v. Stennis-Williams, 557 F.3d 927, 930 (8th Cir. 2009); United States v. Dwyer, 275 F. App’x 269, 272-73 (5th Cir. 2008) (unpublished); United States v. Amato, 540 F.3d 153, 159 (2d Cir. 2008); United States v. Henrie, 177 F. App’x 677 (9th Cir. 2006) (unpublished).

The government’s motion for additional restitution (Docket # 20) is ALLOWED. It is hereby ORDERED that Marie Greany is responsible for additional restitution in the amount of $17, 838.


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