In the
 United States Court of Appeals
               For the Seventh Circuit
                          ____________

No. 01-1672
UNITED STATES     OF   AMERICA,
                                                 Plaintiff-Appellee,
                                 v.

PETER J. RUMSAVICH,
                                            Defendant-Appellant.
                          ____________
            Appeal from the United States District Court
       for the Northern District of Illinois, Eastern Division.
            No. 99-CR-883—William J. Hibbler, Judge.
                          ____________
   ARGUED APRIL 3, 2002—DECIDED DECEMBER 17, 2002
                     ____________


 Before COFFEY, DIANE P. WOOD, and WILLIAMS, Circuit
Judges.
  COFFEY, Circuit Judge. Peter J. Rumsavich was charged
and found guilty of five counts of mail fraud, in viola-
tion of 18 U.S.C. § 1341, and two counts of perjury, in
violation of 18 U.S.C. § 1623. The district court sentenced
Rumsavich to 75 months in prison followed by a 3-year
term of supervised release and ordered the sentences and
subsequent periods of supervision be served concurrently
with each other, as well as ordering restitution totaling
$571,700 to the victims and payment of a special assess-
ment of $550. We affirm.
2                                               No. 01-1672

                             I.
  Beginning in the summer of 1979, Peter Rumsavich
embarked upon the first of his numerous failed business
ventures that tended to be funded by a selected group
of naïvely trusting investors both in the city and suburbs
of Chicago, Ill. Rumsavich incorporated three businesses—
D’Martine Financial, D’Martine Food, G.P. Services, and
Goo-Cheese Pizza—none of which was profitable for more
than a short period of time. In May 1988, when Rumsavich
was faced with the imminent collapse of the Goo-Cheese
Pizza and D’Martine Financial enterprises, he sought
to raise cash with the selling of $750,000 of so-called
“D’Martine Food Services, Inc. Zero Coupon Corporate
Bonds.”
  Rumsavich devoted extensive time and energy to mak-
ing contact with thousands of individuals, and thereaf-
ter proceeded to identify and persuade certain unknowl-
edgeable investors to purchase these bonds. He began by
mailing more than 150,000 brochures and postcards to a
targeted selection of people in neighborhoods known as
being inhabited with an unusually large number of sen-
ior citizens with fixed incomes. The brochures invited the
recipients to attend “financial seminars” conducted by
Rumsavich at libraries and hotels in the nearby suburbs
of Chicago. The brochures recited that Rumsavich was a
former vice president for the investment firm of Dean
Witter with impressive credentials as a “registry financial
planner,” a “certified financial planner,” and a “registered
financial planner.” These claims were false: the position
of a “registered financial planner” does not exist within the
investment banking industry, Rumsavich never was a
certified financial planner, and Rumsavich’s only experi-
ence with managing portfolios was acquired during sev-
eral years at Dean Witter where he was employed as a low-
level office manager rather than a vice president of the
company as represented.
No. 01-1672                                              3

  However, according to the record, a large number of
people, acting in reliance upon Rumsavich’s misrepresen-
tations, attended his seminars and listened (with dreams
and hopes) to his promises of helping them take advan-
tage of the supposedly low-risk, high-yield investment op-
portunities he represented to them. He presented each of
the attendees with carefully crafted questionnaires de-
signed to elicit specific information about their experi-
ence and knowledge of investing, their levels of income
and wealth, and their financial histories. After collecting
the completed questionnaires during his opening contact
session with this select group of people, Rumsavich next
engaged in a process of “cherry picking,” weeding out and
focusing only on those individuals whom he described
as “suitable” investors and inviting them to his private
office for one-on-one meetings where he promoted the
D’Martine Food Services zero-coupon bond.
  The record reflects that during these meetings,
Rumsavich conducted himself like “a pitchman at a coun-
ty fair,” advising his soon-to-be victims that the bonds
would pay an inflated annual interest rate of 12 percent,
mature in six years, and repay each investor two-fold upon
maturation. Just as Rumsavich had made misleading
statements in his earlier brochures about his investment
experience, so did he mislead investors during his individ-
ual meetings about the nature of the bonds. Rumsavich
claimed, for example, that D’Martine Food was an Illinois
corporation when, in fact, D’Martine has never been in-
corporated in any state. Rumsavich also referred to the
bonds as “zero-coupon bonds” despite the fact that they
resembled interest-bearing bonds in the sense that they
were sold at face value rather than at a discount rate.
Rumsavich further misled investors when talking to sen-
ior citizens and stating that “he would invest in some-
thing with security” and that his bonds in the food ser-
vices industry were “a sure thing” with “no risk involved.”
4                                             No. 01-1672

Rumsavich’s “no-fail” bond-selling statements were clever
but at the same time somewhat misleading, for at no time
did he ever disclose, much less even infer that his prior
track record when acting as the manager of pizza restau-
rants was miserable and/or that his D’Martine enterprise
had been plagued with financial troubles and significant
debt since its incorporation. In addition, Rumsavich never
did make known that the proceeds from the bond sales
were being used mainly to pay off his debts to Goo-Cheese
Pizza and D’Martine Financial, in addition to his paying
himself and his wife substantial salaries, despite the
fact that she was neither an employee nor a member of
the board of directors of D’Martine Food Services. He
also found it to his benefit to use his client-investors’
funds to help pay off his personal debts as well as the
creditors of his failed limited partnership, G.P. Services.
  After a federal grand jury indicted him on five counts of
mail fraud in violation of 18 U.S.C. § 1341, and two counts
of perjury in violation of 18 U.S.C. § 1623, Rumsavich
entered pleas of not guilty on each count and the case
went to trial before a jury for some seven days before the
jury found him guilty on all of the seven counts.
  Some three months after the entry of the judgment of
guilty on all counts, U.S. District Judge William Hibbler
conducted a lengthy sentencing hearing and heard testi-
mony from a number of witnesses appearing on behalf
of both the defendant and the Government. Many of
the Government’s witnesses were the investors whom
Rumsavich had swindled. They testified that Rumsavich
gained their trust and ultimately convinced them to
purchase the bonds after he assured them that he was
acting in their best interests and was committed to offer-
ing them prudent financial advice. Rumsavich’s sales
pitch lulled the victims into a sense of false confidence,
and he also saw fit to send them fraudulent, pre-printed
federal 1099 tax forms reflecting that they were earning
No. 01-1672                                             5

tax-deferred interest income that was not payable until
the bonds matured six years from the date of issuance. In
the minds of the unsuspecting investors, according to
the record, the pre-printed tax forms legitimized the
investments by reflecting that the investments were
doing well and that Rumsavich was complying with Inter-
nal Revenue Service guidelines of reporting taxable in-
come. In reality, Rumsavich was “borrowing from Peter
to pay Paul,” for his “investments” operated like a pyra-
mid scheme funded entirely by the sale of bonds to other
investors rather than any growth in corporate revenue
or contributions from outside sources.
  After receiving this testimony at the sentencing hear-
ing and analyzing the arguments of the Government
and the defendant, Judge Hibbler adopted the recommen-
dation in the presentence report and imposed a 2-level
sentencing enhancement, reasoning that Rumsavich “knew
or should have known that many of the people who ulti-
mately purchased the bonds were vulnerable victims
because of their advanced age, their need to get sol-
id retirement planning advice, and their overwhelm-
ing unsophistication in financial matters.” U.S.S.G.
§ 3A1.1(b)(1). The judge also enhanced Rumsavich’s sen-
tence with a second 2-level enhancement after finding
that he had abused a position of private trust as a finan-
cial planner by misleading his customers and using
their money for improper purposes. § 3B1.3. Thus, after
applying the relevant guideline limits for “vulnerable
victim” and “abuse of trust” enhancements, the judge sen-
tenced Rumsavich to a total of 75 months’ imprisonment
for committing five acts of mail fraud in violation of 18
U.S.C. § 1341 and two acts of perjury in violation of
18 U.S.C. § 1623. Each of the sentences imposed was
ordered to run concurrent with each other, to be followed
by three years of supervised release, with each period
of supervised release also to run concurrent with each
6                                                    No. 01-1672

other.1 Rumsavich surrendered to the U.S. Marshals in
June 2001 and presently is incarcerated at a minimum
security federal prison in Wisconsin.


                               II.
                                1.
  On appeal, Rumsavich argues that the district court
erred when it applied the vulnerable victim enhancement
under U.S.S.G. § 3A1.1(b)(1). We review the district court’s
legal interpretation of the Sentencing Guidelines de novo
and the court’s factual findings for clear error. United
States v. Parolin, 

, 928 (7th Cir. 2001). We
are convinced that the trial judge’s enhancement of
Rumsavich’s sentence under § 3A1.1(b)(1) was proper, for
the record supports the finding that Rumsavich had reason
to know that his premeditated, systematic pattern of
defrauding investors was likely to harm the unsuspect-
ing, innocent elderly victims whom he targeted and who
were unusually vulnerable to his unlawful behavior.


                                2.
  Section 3A1.1(b)(1) of the Sentencing Guidelines pro-
vides for a 2-level enhancement “if the defendant knew
or should have known a victim of the offense was a vulnera-



1
  The maximum term of imprisonment on the five counts of
mail fraud was five years for each count, for a possible total
sentence of 25 years. 8 U.S.C. § 1341. The maximum term of
imprisonment on the two perjury counts was five years for each
count, for a possible total sentence of 10 years. 18 U.S.C. § 1341.
The sentencing guidelines called for a sentence in the range of
63 to 78 months, based on Rumsavich’s total offense level of 26
and his criminal history category of I. (PSR at 18.)
No. 01-1672                                                 7

ble victim.” The commentary to the Guidelines defines
a “vulnerable victim” as a person “who is unusually vul-
nerable due to age, physical or mental condition, or who
is otherwise particularly susceptible to the criminal con-
duct” committed by the defendant. U.S.S.G. § 3A1.1(b)(1)
appl’n n.2. In cases where the defendant’s actions and
misdeeds have harmed multiple victims, the enhance-
ment may be imposed if the defendant “targeted any of
the victims because of their unusual vulnerability.” See
United States v. Jackson, 

, 508 n.11 (7th Cir.
1996) (emphasis added). We have previously noted that
“ ‘vulnerability’ is the sort of fact which the trial court is
peculiarly well positioned to gauge” because the trial judge
is in the best position to use his observations of the de-
meanor of the criminal defendant and/or witnesses as
well as having an opportunity to review and analyze each
of the documents and exhibits and hear the testimony
while observing the mental, physical, and emotional states
of the victims in order to assist him with assessing the
damages inflicted upon them. United States v. White, 

, 463 (7th Cir. 1990).
  At the sentencing hearing, and after reviewing the rec-
ord, the trial judge noted that the majority of Rumsavich’s
client-victims were elderly persons who lacked the neces-
sary knowledge, experience, training, or personal judgment
required to make intelligent investment decisions with
respect to their retirement. Additionally, a number of
them were widows who were dependent in the past on
their former husbands for financial planning and advice.
The district judge concluded that a vulnerable victim
enhancement was appropriate, finding that Rumsavich de-
liberately and methodically used a series of targeted mail-
ings, presentations, and one-on-one meetings as a means
of discovering and capitalizing upon his researched knowl-
edge about the victims’ ages, severe physical or emotional
difficulties, widowhood, pronounced need for investment
8                                              No. 01-1672

advice, limited incomes, and/or demonstrated lack of un-
derstanding about financial matters. As the district judge
noted, “It was clear that [Rumsavich] did, in fact, target
these particular individuals, knew of their particular fi-
nancial situation, [and] used that information in such a
manner as to approach them with certain opportunities
that he knew they would be more likely to accept be-
cause of the lack of security that they now had with their
particular investments.”
  On appeal, Rumsavich has devoted a large portion of his
brief attempting to convince us that the defrauded indi-
viduals in this case were fairly sophisticated investors
with a reasonable amount of business savvy and argues
that none of the victims can properly be classified as
“vulnerable victims.” (Br. at 20-22.) This extended verbi-
age, however, falls far short of establishing that the trial
judge committed reversible error, for even if we were to
assume for the sake of argument that the nine victims
selected and identified in Rumsavich’s briefs were experi-
enced investors, we are convinced that an enhancement
was proper, as there is no question that at least one vic-
tim, Ms. Gladys Paine, qualifies as a “vulnerable victim”
within the meaning intended by the Guidelines.
  By sending out the brochures to those residing in
areas with a disproportionate number of elderly people,
Rumsavich piqued Paine’s attention, lured her to one of
his seminars, and preyed upon her fears of bankruptcy
with the presentation of pamphlets titled, “The Cruel Cost
of Long-Term Care,” “Long-Term Health Care and Poverty:
Price of Nursing Care Is Poverty, Survey Says,” and
“A Retiree’s Biggest Poverty Trap: Nursing Homes.”
Rumsavich convinced Paine to fill out a selected number
of questionnaires in an attempt to gain a wealth of infor-
mation focusing on the question of whether she had appre-
ciable cash reserves and, if so, what amount could be
invested without necessitating the securing of a loan or
No. 01-1672                                                 9

sale of other assets. From these questionnaires, Rumsavich
learned that Paine had retired, having resigned from her
position as a nursing home administrator in 1987, and had
recently suffered the loss of her husband. Next he deter-
mined that Paine was, in his words, a “suitable” target
for his investment scheme, and he telephoned Paine and
invited her to meet with him for a second, personal, one-on-
one interview at a sprawling office complex in Rolling
Meadows, Ill., which he held out to be the office of his so-
called “financial planning agency.”
  During their tête-a-tête, Paine confirmed that she was
“not very knowledgeable” in financial affairs and that her
now-deceased husband had managed the family’s entire
investment portfolio. Rumsavich gained Paine’s confi-
dence by misrepresenting the nature of his investment
scheme and convincing Paine he was concerned about
her financial well-being. He further promised Paine that
he would offer her financial security and mischievously
recommended that she purchase an $18,000 bond at a
price that coincided exactly with the amount of money
she had received from her husband’s insurance policy
upon his death. At this time, Rumsavich obviously knew
that his food-service industry bonds were risky invest-
ments, to say the least, for none of his retail pizza busi-
nesses ever turned a profit and each one was bordering
on bankruptcy as early as February 1988. Nevertheless,
following their first meeting in June 1988, Rumsavich
relieved Paine of her retirement nest egg and all of the
monies he could get his hands on. Rumsavich pulled off
this feat by lulling Paine into a false sense of security
with the alleged mailing of the previously referred-to
fraudulent, pre-printed 1099 tax forms which indicated
that her investments were earning taxable income in the
form of accrued interest. It is exactly this type of “lulling”
correspondence and misleading salesmanship that courts
have on numerous occasions held to support convictions
10                                                   No. 01-1672

under the mail fraud statute. See, e.g., United States v.
Lang, 

, 452 (1986); United States v. Sampson,

, 80-81 (1962); United States v. Bach, 

, 521-22 (7th Cir. 1999); United States v. Brocksmith,

, 1367-68 (7th Cir. 1993).2
  Note two of the Application Notes to § 3A1.1 provides that
“[t]he [‘vulnerable victim’] adjustment would apply, for
example, in a fraud case in which the defendant mar-
keted an ineffective cancer cure or in a robbery in which
the defendant selected a handicapped victim.” We agree
with the court’s decision to enhance Rumsavich’s sentence
because he deliberately, systematically, and purposefully
targeted Paine and a number of other widowed, aged,
unsophisticated and unwary investors as victims in his


2
   In addition to appealing from the district court’s sentencing
judgment, Rumsavich also appeals from his conviction under the
federal mail fraud statute, 18 U.S.C. § 1341, on the basis that the
district court should have dismissed such charges as untimely.
(Br. at 11-15.) The federal mail fraud statute has a five-year
statute of limitations that “begins to run from the date of mailing
of the fraudulent information.” United States v. Barger, 

, 847 (7th Cir. 1999). Although Rumsavich admits that he
mailed IRS 1099 Forms to his victims as late as March of 1999,
well within the five-year limitations period, he claims that such
mailings were a mere effort to “conceal a prior fraud scheme,” (Br.
at 15) and that they were not part of the fraud scheme itself. (Br.
at 14)
  As stated above, we agree with the Government that the 1099
forms constituted “lulling” correspondence, and that Rumsavich’s
mailing of the forms was done in furtherance of his ongoing
scheme to defraud his investors. 

. Accordingly, because
Rumsavich continued to engage in acts of mail fraud through
March of 1999, the Government’s mail fraud charges were
timely filed within the five-year statute of limitations, and the
district court properly denied Rumsavich’s Motion to Dismiss
such charges as untimely.
No. 01-1672                                             11

high-risk business ventures and then proceeded to system-
atically and deliberately defraud them. As we explained
in Part I, Rumsavich began by mailing brochures to resi-
dents living in areas inhabited with a large number of
unsophisticated elderly retirees. Through the use of care-
fully crafted questionnaires he presented to the retirees
who had on prior occasions received the same flier and
thereafter attended his investment seminars in the city
and suburbs of Chicago, Rumsavich was able to further
narrow down and identify even more naïve, gullible individ-
uals who: (1) had an unusual need for sound advice from
a financial planner; and (2) lacked more than a basic un-
derstanding of investment strategies and theories. It was
only towards this group of people—those financially inex-
perienced elderly people who needed Rumsavich’s help
and were particularly likely to rely upon his advice to
their detriment—that Rumsavich targeted his fraudulent
investment schemes.
  We are convinced that an unscrupulous person like
this—who methodically schemes and plans to separate out
those elderly and inexperienced investors in dire need
of prudent investment planning and thereafter proceeds
to cheat them out of their life savings—is eligible for a
“vulnerable victim” enhancement no less than a huckster
who peddles “an ineffective cancer cure” to those unfor-
tunate people dying of cancer. U.S.S.G. § 3A1.1 appl’n
n.2. We agree with the trial judge’s determination that
Rumsavich’s victims were vulnerable because they had “a
lower than average ability to protect themselves” against
his fraudulent investment programs, United States v.
Grimes, 

, 637 (7th Cir. 1999), due to a com-
bination of their age, severe physical or emotional diffi-
culties, widowhood, pronounced need for sound and truth-
ful investment advice, limited incomes, and frequently
combined with a demonstrated lack of knowledge and
understanding of financial ventures. See T.M. Murch, Note,
12                                              No. 01-1672

Revamping the Phantom Protections for the Vulnerable
Elderly, 6 ELDER L.J. 49 (1998). We refuse to hold that the
judge committed clear error when he enhanced Rumsavich’s
sentence for preying upon these unusually vulnerable in-
vestors, see 

, and also for abusing
a position of trust as a financial planner for elderly per-
sons. See United States v. Stewart, 

, 767-71 (7th
Cir. 1994); United States v. Dobish, 

, 762 (6th
Cir. 1996) (per curiam). “One adjustment focuses on the
victim, who was demonstrated to be vulnerable. The other
adjustment looks to the conduct of the offender, who
abused a position of trust.” United States v. Haines, 

, 293 (7th Cir. 1994).


                            III.
  The trial court acted within its discretionary bound-
aries when enhancing Peter J. Rumsavich’s sentences based
upon a clear and convincing finding that he deliberately
abused a position of trust and cruelly inflicted harm upon
at least one vulnerable victim. Rumsavich’s remaining
arguments are without merit and we see no need to ad-
dress them. The judgment of the district court is AFFIRMED.

A true Copy:
      Teste:

                        ________________________________
                        Clerk of the United States Court of
                          Appeals for the Seventh Circuit




                   USCA-02-C-0072—12-17-02