In the
United States Court of Appeals
For the Seventh Circuit

No. 99-2500

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v.

MELODIE KIPTA,

Defendant-Appellant.


Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 97 CR 638--Milton I. Shadur, Judge.


Argued December 7, 1999--Decided May 18, 2000



  Before HARLINGTON WOOD, JR., RIPPLE, and ROVNER,
Circuit Judges.

  HARLINGTON WOOD, JR., Circuit Judge. Defendant-
appellant Melodie Kipta pled guilty to one count
of bank fraud in violation of 18 U.S.C. sec.
1344. She was sentenced to 27 months
imprisonment. On appeal, Kipta challenges the
district court’s determination of her sentence,
arguing that the district court erred in
calculating the amount of loss attributable to
her fraudulent conduct.

I.   BACKGROUND

  In 1996, Kipta maintained two bank accounts,
one at the Loyola University Employees’ Credit
Union ("Loyola") and a second joint account with
her husband at the First National Bank of Chicago
("First Chicago"). On July 19, 1996, Kipta wrote
a check for $46,355.46 on her Loyola account and
deposited it into the First Chicago account. On
July 25, Kipta wrote a check for $20,000.00 on
the Loyola account and deposited it into the
First Chicago account. Because she did not have
funds in the Loyola account to cover these
checks, Kipta arranged for a fraudulent letter to
be faxed to First Chicago on July 29. The letter,
which was printed on Loyola Credit Union
letterhead, stated that Kipta was a customer in
good standing at the credit union, that she had
$800,000.00 in funds available, and that First
Chicago should have no concerns regarding the
deposits by Kipta or any subsequent withdrawals.

  On July 30, 1996, Kipta wrote a check for
$60,000.00 on her Loyola account and deposited it
into the First Chicago account. Finally, on
August 15, Kipta deposited a check written on her
Loyola account for $45,000.00 into the First
Chicago account and, that same day, attempted to
obtain a First Chicago cashier’s check in that
amount. At no time during this period did Kipta
have more than $600.00 in her Loyola account.
Nevertheless, between July 17 and August 6, 1996,
Kipta and her husband wrote eight checks on the
First Chicago account for withdrawals totaling
$39,500.00. First Chicago honored these checks
based on Kipta’s fraudulent deposits. The total
actual loss to First Chicago as a result of
Kipta’s scheme was $38,219.92.

  On September 10, 1997, based on the facts
outlined above, Kipta was indicted by a grand
jury on five counts of bank fraud in violation of
18 U.S.C. sec. 1344. On January 30, 1998, Kipta
pled guilty pursuant to a written plea agreement
to one count of bank fraud. On July 13, 1998,
Kipta appeared before Judge Shadur on a
superseding written plea agreement, entering a
plea of guilty to one count of bank fraud and
admitting to additional offenses as stipulated
conduct. The stipulated conduct involved a
scheme, perpetrated during September 1997, in
which Kipta defrauded one of her employers by
stealing and forging checks.

  Kipta was sentenced on July 7, 1999. At
sentencing, Kipta challenged the probation
officer’s amount of loss determination, arguing
that she should be held liable only for the
actual loss to First Chicago, $38,219.92, and not
for the total amount deposited into the First
Chicago account, a sum of $171,355.46. The
district court found that Kipta’s case did not
parallel a check-kiting situation in which the
total amount of deposits is never at risk due to
the necessity of maintaining the float. The court
adopted the probation officer’s recommendation
and based Kipta’s amount of loss on a total
intended loss to First Chicago of $171,355.46.
Given this finding, the district court increased
Kipta’s offense level by seven levels under sec.
2F1.1(b) (1)(H) of the United States Sentencing
Guidelines (the "Guidelines" or "U.S.S.G.")/1
and assigned Kipta a total offense level of 17.
Kipta scored a criminal history category II,
resulting in a Guidelines range of 27 to 33
months imprisonment. The district court sentenced
Kipta to 27 months imprisonment followed by a
five-year term of supervised release and ordered
her to pay $38,219.92 in restitution to First
Chicago and a $100.00 special assessment. Kipta
appeals.

II.   ANALYSIS

  Kipta argues that the district court erred in
holding her liable for an amount of loss greater
than the actual loss suffered by First Chicago.
Under U.S.S.G. sec. 2F1.1(b)(1), a defendant’s
base offense level in a fraud case is enhanced
based on the amount of loss involved. While the
district court’s assessment of the amount of loss
is a factual finding which we review under a
clearly erroneous standard, the meaning of loss
under sec. 2F1.1(b)(1) is a legal determination
which we review de novo. United States v.
Saunders, 

, 929 (7th Cir. 1997).

  Kipta asserts that the district court
erroneously analyzed her conduct as a fraudulent
loan offense rather than as a check-kiting
scheme. Kipta contends that she should be held
liable only for the $38,219.92 actual loss to
First Chicago and not for the remaining funds
which, while fraudulently deposited, were never
withdrawn. However, as we have noted, "in all
fraud cases, Application Note 7 [to sec. 2F1.1]
requires district courts to increase a
defendant’s offense level based on the greater
value of either the actual loss suffered by the
victims of the fraud or the intended . . . loss
which the defendant attempted to inflict on the
victims." 

; see also
U.S.S.G. sec. 2F1.1, comment. (n.7) ("[I]f an
intended loss that the defendant was attempting
to inflict can be determined, this figure will be
used if it is greater than the actual loss.").
Kipta’s actions are analogous to the conduct we
examined in United States v. Strozier, 

(7th Cir. 1992). As was the case in Strozier,
Kipta’s scheme was not based on a float in which
checks are circulated back and forth between two
accounts, a situation which limits the amount
available for withdrawal and the corresponding
risk of loss. Instead, Kipta used the fraudulent
letter and checks she knew would bounce to
inflate the balance only in the First Chicago
account and then caused checks to be drawn
against this inflated balance. The district court
did not err in basing Kipta’s amount of loss
calculation on the value of the intended, rather
than the actual, loss.

  Having determined that the district court’s
sentencing calculations were based on a proper
interpretation of sec. 2F1.1(b)(1), we turn to
the district court’s assessment of the amount of
the intended loss. We find that the district
court’s determination that Kipta intended to
defraud First Chicago out of the entire
$171,355.46 was not clearly erroneous. The
fraudulent letter that Kipta used to back her
deposits stated that she had reserves of
$800,000.00, an amount more than sufficient to
cover the deposits into the First Chicago
account. There was nothing to limit the amount of
funds available for withdrawal, and the
corresponding potential for loss by First
Chicago, to less than the total amount deposited
into the account. See United States v. Yusufu, 

, 513 (7th Cir. 1995) (holding that the
amount that a defendant made available to himself
by way of fraudulent deposits demonstrated the
amount of loss intended); see also United States
v. Bonanno, 

, 509-10 (7th Cir. 1998)
("[T]he relevant inquiry is not ’How much would
the defendants probably have gotten away with?’,
but, rather, ’How many dollars did the culprits’
scheme put at risk?’."). Furthermore, it is
undisputed that Kipta unsuccessfully attempted to
negotiate her final deposit of $45,000.00 into a
cashier’s check. These facts support the district
court’s conclusion that Kipta intended to
withdraw the entire amount deposited. Kipta’s
claim of error fails.

III.   CONCLUSION

  Kipta’s sentence is affirmed.

/1 Section 2F1.1(b)(1)(H) provides for a seven-level
enhancement in offense level for cases in which
the amount of loss is greater than $120,000.00
but less than $200,000.00.