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

Nos. 03-1111, 03-1114, 03-1140, 03-1172, 03-1176, 03-1180, 03-
1408, 03-1590, 04-1014, 04-1035, 04-1057, 04-1072, 04-1073,
04-1095, 04-1125


UNITED STATES OF AMERICA,
                                                    Plaintiff-Appellee/
                                                     Cross-Appellant,
                                  v.


MICHAEL SPANO, SR., et al.,
                                             Defendants-Appellants/
                                                   Cross-Appellees,
                                 and

BONNIE LAGIGLIO,
                                                Defendant-Appellant.
                          ____________
            Appeals from the United States District Court
        for the Northern District of Illinois, Eastern Division.
                No. 01 CR 348—John F. Grady, Judge.
                          ____________
    ARGUED APRIL 5, 2005—DECIDED SEPTEMBER 1, 2005
                     ____________


   Before POSNER, EASTERBROOK, and EVANS, Circuit
Judges.
2                                         Nos. 03-1111 et al.

   POSNER, Circuit Judge. The seven defendants were con-
victed after a three-month jury trial of a variety of federal
offenses, including mail fraud, RICO, and money launder-
ing, arising out a scheme to defraud the Town of Cicero,
Illinois. (Bonnie LaGiglio, however, was convicted only of
a tax offense.) They received prison sentences ranging from
41 to 151 months, as well as being ordered to forfeit a total
of $4 million in proceeds of their fraud (plus two real estate
parcels)—a fraud that cost the Town more than $10 million.
Their appeals, together with the government’s cross-appeal,
which seeks higher sentences for all but Bonnie LaGiglio,
present more than 20 issues, but many of them are too
insubstantial to require discussion. Because the sentences
were based in part on factfindings made by the judge, the
government concedes that the defendants are entitled to the
limited remand authorized by United States v. Paladino, 

, 483-84 (7th Cir. 2005), though to nothing more. The
force of the concession is obscure, in light of the govern-
ment’s cross-appeal; but that is for later.
  Cicero is self-insured for its employees’ health benefits,
and until 1992 used the Travelers insurance company to
process the bills submitted to the Town by providers of
health care to its employees. That year the Town switched
to Specialty Risk Consultants. SRC, created by two of the
defendants, was the instrument of the fraud; other defen-
dants were Town officials, including the President of the
Board of Trustees (i.e., mayor), Loren-Maltese. Millions of
dollars that the Town paid to SRC were siphoned to a
partnership, Plaza Partners, which was a tool of the conspir-
ators and provided them with money and other things of
value, including a golf course and a horse farm. The fraud,
which continued until it was unmasked in 1996, has done
nothing for the reputation of Cicero, a town notorious as the
headquarters of Al Capone, Hanania v. Loren-Maltese, 212
Nos. 03-1111 et al.                                           

, 354 (7th Cir. 2000); Laurence Bergreen, Capone: The
Man and the Era 97-99 (1996); Matthew Engel, “Spirit of
Capone Lives on in Mobtown, Illinois: Mayor’s $12m Scam
Follows in Footsteps of Scarface, Baldy and the Big Tuna,”
Guardian (London), Aug. 31, 2002, p. 3, and with an 80-year
history of links to organized crime. “Is Cicero Ready for
Reform?,” Chicago Tribune, Apr. 3, 2003, p. 22.
  Loren-Maltese, though a key player in the fraud by virtue
of her position as the Town’s mayor, received only modest
remuneration—primarily reimbursement of 100 percent of
her medical bills; Cicero’s benefits plan entitled her to only
80 percent. She points out that there was a practice predat-
ing the fraud of reimbursing additional amounts upon
written authorization by a Town official; her predecessor
had been reimbursed for 100 percent of his medical bills on
this basis, and presumably she would have been as well
even if SRC had not replaced Travelers as the administrator
of the Town’s plan.
  She argues that if the extra coverage she received was not
in exchange for her complicity in the fraud, she is not guilty
of the form of fraud, with which she was charged, that
consists of an official’s depriving the government of his or
her honest services. 18 U.S.C. §§ 1341, 1343, 1346; United
States v. Martin, 

, 965-66 (7th Cir. 1999). The
argument is a non sequitur. A participant in a scheme to
defraud is guilty even if he is an altruist and all the benefits
of the fraud accrue to other participants, Lombardo v. United
States, 

, 159-60 (7th Cir. 1989); cf. United States
v. Moede, 

, 242 (7th Cir. 1995); United States v.
Blasini-Lluberas, 

, 65 (1st Cir. 1999); United States
v. Oplinger, 

, 1065 (9th Cir. 1999), just as a
conspirator doesn’t have to benefit personally to be guilty of
conspiracy—a point so obvious that we can’t find a case that
states it, although it is implicit in statements of the elements
4                                          Nos. 03-1111 et al.

of conspiracy, of which personal benefit is not one. E.g.,
United States v. Duran, 

, 835-36 (7th Cir. 2005);
United States v. Miller, 

, 555-56 (7th Cir. 2005).
For that matter, neither the scheme to defraud, United States
v. Tadros, 

, 1006 (7th Cir. 2002); United States v.
Pimental, 

, 585 (1st Cir. 2004), nor the conspir-
acy, e.g., United States v. Bond, 

, 1079 (7th Cir.
2000); United States v. Martin, 

, 10-11 (1st Cir.
2000), has to succeed in inflicting harm for the participants
to be guilty.
  In the case of a successful scheme, the public is deprived
of its servants’ honest services no matter who receives the
proceeds. In any event there was evidence that as a reward
for her participation Loren-Maltese received accelerated
reimbursement and, more important, reimbursement of 100
percent of the medical expenses incurred by members of her
family; there was no evidence that her predecessor had
received such largesse.
   She makes the related complaint that she should not have
been found liable to forfeit more than $3 million of illegal
proceeds, since so little of that amount found its way into
her pocket. But the proceeds of a conspiracy are a debt owed
by each of the conspirators. United States v. Genova, 

, 761 (7th Cir. 2003); United States v. Masters, 

, 1369-70 (7th Cir. 1991); United States v. Edwards, 

, 643-44 (5th Cir. 2002). It would be absurd to treat
them more leniently than the law treats a lawful partner-
ship, all of whose members are severally as well as jointly
liable for the partnership’s debts.
  A number of cases, it is true, though none in this circuit,
require the defendant to forfeit only so much of the pro-
ceeds (not received by him) of the fraud as were foreseeable
to him, e.g., United States v. Fruchter, 

, 384 (2d
Nos. 03-1111 et al.                                            5

Cir. 2005); United States v. Bollin, 

, 419 (4th Cir.
2001); United States v. Corrado, 

, 558 (6th Cir.
2000); United States v. Hurley, 

, 22 (1st Cir. 1995), by
analogy to the liability of a conspirator for only those
misdeeds of his coconspirators that were foreseeable by
him. 

do not discuss this requirement. We
have found no case that rejects it, but we note that there is
a difference between criminal liability for the acts of others
and liability on a debt created by partners in a criminal
scheme. No matter; Loren-Maltese authorized payments by
the Town to SRC and knew that SRC was a fraud and so
should have foreseen the possibility of a massive loss. She
does not argue the contrary or even that foreseeability is
required for a forfeiture.
  The only other significant issue she raises concerns the
judge’s exclusion, as being unreliable, of minutes of meet-
ings of the Town’s Board of Trustees held several months
after the government’s investigation of the fraud became
public knowledge. Loren-Maltese presided at meetings of
the Board and other conspirators were among its members.
The minutes of the meeting of January 6, 1997, contain a
statement by one of the conspirator members (though he
was acquitted), DeChicio, that no payments had been made
by the Town to SRC since October 1996. That was false. A
week later the minutes were amended to state that at the
January 6 meeting Loren-Maltese had twice asked DeChicio
whether any payments had been made to SRC “since the
October 1996 Board Meeting at which time the board
directed no further monies be paid to [SRC] unless by Town
Board approval.” Neither the October board meeting
minutes nor the January 6 meeting minutes had mentioned
any such direction. The inference of doctoring, even in the
case of the unamended version of the January 6 minutes, is
strong, and the public-records exception to the hearsay rule
6                                           Nos. 03-1111 et al.

is inapplicable when the “circumstances indicate lack of
trustworthiness.” Fed. R. Evid. 803(8); Beech Aircraft Corp. v.
Rainey, 

, 167-68 (1988).
   The provision is tailor-made for a case in which the
records are controlled by the defendants themselves rather
than by clerks assumed to be disinterested. Reynolds v.
Green, 

, 596 (6th Cir. 1999); Peppers v. Ohio Dept.
of Rehabilitation & Correction, 

, 1094-95 (Ohio
App. 1988); compare Espinoza v. INS, 

, 310 (9th
Cir. 1995). As we explained recently in Kikalos v. United
States, 

, 904 (7th Cir. 2005), with reference to the
parallel hearsay exception for business records, Fed. R.
Evid. 803(6), “when the record keeper, rather than being a
clerical or professional employee, is a principal with a
strong motive to falsify the records, the district judge may
deem them so unreliable as to be unworthy of consideration
by the jury; in the language of the rule, they are to be
excluded if ‘the method or circumstances of preparation
indicate lack of trustworthiness.’ See Wheeler v. Sims, 

, 802 (7th Cir. 1992); Bracey v. Herringa, 

,
704-05 (7th Cir. 1972); Romano v. Howarth, 

, 108
(2d Cir. 1993).”
   Bonnie LaGiglio was the wife of one of the principal
conspirators. Her name appears in the signature space of
countless checks issued by Plaza Partners. In addition,
funds that passed from the Town to SRC to Plaza Partners
were disbursed by the partnership to her and reported on
her income tax returns. If her signature on the checks was
genuine, the jury was entitled to infer that she knew that the
partnership was an instrument of fraud and thus knowingly
helped it to succeed. Although the judge found “that there
is simply insufficient evidence for this jury to conclude that
she knew about the fraud against the town,” that finding is
consistent with her conviction for conspiracy to impede the
Nos. 03-1111 et al.                                          7

IRS in the assessment and collection of taxes. 18 U.S.C. §
371. The evidence revealed that she knew that Plaza Part-
ners was a device for enabling her husband to avoid
reporting income to the IRS, and thus knowingly assisted
him in that project.
  She claims that her husband forged all her signatures. The
jury was shown handwriting exemplars—that is, signatures
of Bonnie LaGiglio known to be genuine—and asked to
compare them with the signatures in her name on the
checks and on other documents of Plaza Partners. No
handwriting expert testified about the genuineness of the
contested signatures. The checks and other documents were
all copies, and in closing argument the prosecutor began to
argue that handwriting experts are unable to authenticate
signatures on copies. The defense rightly objected on the
ground that no expert testimony or other basis had been
provided for that implausible argument, and the judge
ordered it stricken. It is doubtful that the argument helped
the prosecutor; told that even an expert can’t verify the
genuineness of signatures on copies, a juror asked to do just
that might doubt his ability to do so, and vote to acquit. In
any event, no rule of evidence makes a jury incompetent to
determine the genuineness of a signature by comparing it to
a signature known to be genuine. Fed. R. Evid. 901(b)(3);
United States v. Papia, 

, 1366-67 (7th Cir. 1990);
United States v. Saadey, 

, 679-80 (6th Cir. 2005);
United States v. Wylie, 

, 978 (5th Cir. 1990);
United States v. Woodson, 

, 551-52 (9th Cir. 1975)
(per curiam).
  All the defendants complain about a pair of incidents
involving the jury. Cicero has, as we noted, a long history of
being a center of organized crime. During the trial one of the
jurors brought into the jury room a book that discussed
organized crime in Cicero in the 1920s to 1940s (a period
8                                           Nos. 03-1111 et al.

that encompassed the Capone era—he was active in Chicago
from 1920 to 1931, becoming boss of the Chicago mob in
1925). The other jurors reported this juror to the judge, who
removed him from the jury but concluded after talking to
the other jurors that they had not been contaminated by
their exposure to the book. The judge observed realistically
that most Chicagoans have some awareness of the associa-
tion between Capone and Cicero.
  The day after the jury was discharged, a Chicago newspa-
per reported that one of the jurors said that Spano, Sr.’s
reputed mob connections had been mentioned during the
jury deliberations. The judge did not think that the newspa-
per article required him to conduct a hearing at which the
jurors would be asked what exactly they had heard about
Spano, Sr.’s mob connections. Ordinarily when extraneous
materials are brought into the jury room, a hearing is
required (as in the case of the book about Cicero) to deter-
mine whether the jurors’ deliberations were fatally compro-
mised by their exposure to the materials. Remmer v. United
States, 

, 229 (1954); United States v. Reynolds , 

, 295-96 (7th Cir. 1995). But that is not a hard and
fast rule. As we explained in Wisehart v. Davis, 

,
326 (7th Cir. 2005), “the extraneous communication to the
juror must be of a character that creates a reasonable
suspicion that further inquiry is necessary to determine
whether the defendant was deprived of his right to an
impartial jury. How much inquiry is necessary (perhaps
very little, or even none) depends on how likely was the
extraneous communication to contaminate the jury’s
deliberations. Evans v. Young, 

, 1083-84 (7th
Cir. 1988); Dyer v. Calderon, 

, 974-75 (9th
Cir.1998) (en banc); United States v. Williams-Davis, 

, 499-501 (D.C. Cir. 1996); see generally Oswald v.
Bertrand, 

, 477-78, 480 (7th Cir. 2004).” See also
Nos. 03-1111 et al.                                           9

United States v. Stafford , 

, 1112-13 (7th Cir.
1998). Jurors after all know many things that are not
presented to them in the course of the trial, and doubtless
use much of that background knowledge during their
deliberations. Lots of things mentioned in jury deliberations
are outside the record. Were the report of a juror who claims
to have heard such a thing mentioned enough to require a
hearing, few trials would end without a post-trial interroga-
tion of the jurors; jury service would be even less popular
than it is.
  This trial lasted three months and the deliberations alone
lasted 11 days; it is unlikely in the extreme that extraneous
speculations were never voiced in the jury room. The trial
judge, having observed the jury carefully and having been
impressed by the jurors’ conscientiousness (remember how
they reacted to the book), did not abuse his discretion in
concluding that the likelihood that a reference to Spano,
Sr.’s possible connections to organized crime had polluted
the jury’s consideration of the case was too slight to warrant
hauling the jurors before him for an examination. See, e.g.,
United States v. Berry, 

, 600 (7th Cir. 1996); United
States v. Lloyd, 

, 238-39 (3d Cir. 2001); United
States v. Sanders, 

, 668-74 (7th Cir. 1992); United
States v. Bruscino, 

, 940-41 (7th Cir. 1982) (en
banc).
   Taylor, a key conspirator who had turned state’s evidence,
was a principal witness for the government. After the trial
the defendants discovered that he had been an alcohol
abuser and marijuana user during the conspiracy. They
moved for a new trial on the basis of this newly discovered
evidence, which they would have liked to impeach him
with. It is improper to impeach a witness by presenting
evidence that he has engaged in criminal or otherwise
illegal or socially reprobated behavior unless the evidence
10                                         Nos. 03-1111 et al.

undermines the credibility of his testimony beyond what-
ever undermining would be accomplished just by besmirch-
ing the witness’s character. United States v. Mojica, 

, 788-89 (7th Cir. 1999); Henderson v. DeTella, 

,
949 (7th Cir. 1996); United States v. Robinson , 

,
1397-98 (7th Cir. 1992). Were there any indication that
Taylor had been high when he was testifying, that would
certainly have been appropriate to point out to the jury; and
likewise if there were any reason to think that alcohol or
marijuana had seriously impaired his memory or had
prevented him from understanding the events about which
he testified when they took place. 

Jarrett v.
United States, 

, 1445-46 (7th Cir. 1987); see
United States v. Sasso, 

, 347-48 (2d Cir. 1995);
compare United States v. Smith, 

, 1054-55 (10th
Cir. 1998). There was no reason to think either of these
things. Nothing in Taylor’s demeanor or testimony sug-
gested to the judge that he was impaired to any degree. And
there could be no doubt of his having been able to observe
accurately the acts of the defendants during the fraud, for he
had been the general manager of SRC. Had he been drunk,
high, or otherwise behaving erratically during the conspir-
acy, the defendants, with whom he had had continuous
dealings over a three-year period, would have noticed, and
would have prompted their lawyers to cross-examine him
accordingly—which the lawyers did not do.
  The defendants are, however, entitled to a Paladino
remand—which brings us to the government’s cross-appeal.
The government asked us in its brief to affirm the defen-
dants’ convictions and sentences, but, “alterna-
tively”—meaning, presumably, that if we don’t affirm the
convictions and sentences—to order the defendants (all but
Bonnie LaGiglio) to be resentenced in accordance with the
grounds presented in the cross-appeal. Paladino prevents us
Nos. 03-1111 et al.                                         11

from affirming the sentences until the trial judge has
advised us whether, had he known the federal sentencing
guidelines were merely advisory, he would have given the
defendants lighter 

.
  There are two ways to interpret the government’s posi-
tion. One is that unless we affirm the sentences here and
now, we should (if the cross-appeal has merit) remand for
resentencing. The other is that, should there be a Paladino
remand (as there must be), we should wait and see whether
the remand results in a different sentence for any of the
defendants; if not and if in consequence we affirm the
original sentences, then the government has obtained its
preferred result, and its alternative submission (that the
defendants be resentenced) becomes moot. If the second
interpretation is correct, we could suspend consideration of
the cross-appeal until we hear from the judge, and if he
decided that he would not have sentenced differently we
would then dismiss the cross-appeal. But if the cross-appeal
has identified errors, it is better that we point them out now,
rather than have to order the defendants resentenced after
the Paladino remand. So let us determine the merits of the
cross-appeal and then return to the question of the precise
sense in which the government is demanding sentencing
relief “alternatively.”
  The government contends that the sentences of some of
the defendants should have been enhanced because they
had corrupted a “financial institution,”             U.S.S.G.
§ 2F1.1(b)(6) (1997) (now § 2B1.1(b)(13)); United States v.
Lauer, 

, 768-70 (7th Cir. 1998), namely SRC. The
term “financial institution” is defined to include insurance
companies and “similar” enterprises. U.S.S.G. § 2F1.1
Application Note 14 (1997) (now § 2B1.1 Application Note
1). SRC processed claims, which is a typical insurance-
company function. But what makes an insurance company
12                                          Nos. 03-1111 et al.

a financial institution is that it invests its premiums in order
to create a fund out of which to pay claims; it is a financial
intermediary. See Thomas A. Smith, “Institutions and
Entrepreneurs in American Corporate Finance,” 

.
Rev. 1, 5 (1997). SRC was not an insurance company and
did not engage in financial intermediation. Money flowed
through it, from the Town treasury to claimants and of
course to the defendants, so it was “intermediate” between
Town and claimants in a literal sense. But that is no differ-
ent from the situation of a grocery store, which takes in
money from its customers and pays it out to its owners and
suppliers. Compare United States v. Ferrarini, 

,
160-62 (2d Cir. 2000).
   The government next contends that in calculating the loss
caused by the fraud the judge should have disregarded all
costs incurred by SRC in processing claims. The reasoning
is that if the defendants are allowed to deduct those costs in
figuring the Town’s loss, inefficient frauds will be penalized
less severely than efficient ones, because the costs sub-
tracted from the proceeds of the fraud to determine the loss
to the victim of the fraud will be larger and the net proceeds
therefore smaller. The government is correct that the
fraudster’s costs shouldn’t be deducted, United States v.
Hausmann, 

, 960 (7th Cir. 2003), any more than
the costs of a burglar’s tool should be deducted in determin-
ing the loss suffered by the victim of the burglary. The
objective in calculating the loss inflicted by a crime is to
determine how much worse off the victim was made by the
crime, see, e.g., United States v. Frost , 

, 659 (7th
Cir. 2002), and so the costs incurred by the criminal to
commit the crime are irrelevant. But the qualification is vital,
since the criminal may have expenses unrelated to the
crime. That is the case here. Out of the total amount that the
Town paid SRC, $33.8 million, SRC paid $22 million in
Nos. 03-1111 et al.                                         13

legitimate claims and incurred costs to process them. Had
the Town hired a legitimate claims processor, the price
charged the Town by the processor would have reflected his
costs. The loss to the Town was the difference between what
it paid SRC to process the legitimate claims that SRC paid
out and what it would have paid a legitimate processor to
process those claims. A defendant is entitled “to deduct
from the loss calculation any value the defendant gave the
victim at the time of the fraud.” United States v. Janusz, 

, 1324 (10th Cir. 1998).
  The judge did this. But the government is right that
having determined that the loss caused by the fraud was
$10.6 million the judge should not have rounded this
number off to below $10 million, which reduced the length
of the defendants’ sentences. The judge’s reason was that
$10.6 million was merely an estimate, which might therefore
be off—might indeed be off by $600,001. No doubt. But
unless he thought the estimate biased, he had no basis for
rounding down any more than he would have had for
rounding up. Reasonable estimates are proper predicates for
calculating loss. U.S.S.G. § 2F1.1 Application Note 9 (1997)
(now § 2B1.1 Application Note 3(C)); United States v.
Bhutani, 

, 668 (7th Cir. 2001); United States v.
Snyder, 

, 1295-96 (11th Cir. 2002); United States
v. Carboni, 

, 46 (2d Cir. 2000).
  This was error and ordinarily an error in a sentence
requires resentencing. But not if the government would
prefer the original sentences to stand than to take its chances
with a resentencing that could result in lower sentences
even after the error that the judge committed against the
government (the rounding down) is corrected. If the
defendants are resentenced, then since the guidelines are
now merely advisory the district judge will not be strictly
bound by the sharp line drawn by the sentencing guidelines
14                                        Nos. 03-1111 et al.

between frauds that cause a loss of $9,999,999 and those that
cause a loss of $10,000,000. Were he to decide that an
estimate so close to the line did not, in the circumstances of
this case, warrant the bump up in sentences that the guide-
lines decree at $10 million, and on that basis decided that
the original sentences were proper, we would be unlikely to
deem his action an unreasonable departure from the
guidelines, and we would therefore have to affirm. This
means that if, in a Paladino remand, the judge determined
that he would have given the defendants the same sentences
he imposed originally even if he’d known the guidelines
were merely advisory, his decision would not be invalidated
by the error that we have found. Those sentences would
therefore stand.
  If, however, the judge is required to resentence the
defendants because of the error he committed against the
government, he may conceivably give them lower sentences,
the guidelines no longer being mandatory. The question is
whether the government wants to run that risk. One of us
asked the government’s lawyer at argument: “Do you want
to pursue the cross-appeal after Booker? Of course, if you
succeed on any aspect of the cross-appeal, instead of there
being a limited Paladino remand, there will be a vacatur and
a straight remand with instructions to resentence and, of
course, at the resentencing, [the district judge] can give the
very same sentence he gave if not a lower one.” To which
the lawyer replied: “We’ve considered this very carefully,
your honor, and we’re prepared to take our chances. We are
pursuing the cross-appeal.” We interpret this to mean that
the government wants the defendants resentenced—all but
Bonnie LaGiglio, who, therefore, is alone entitled to a
Paladino remand, pending which we retain jurisdiction of
her appeal. We vacate the judgments of the other defen-
dants and remand for resentencing.
Nos. 03-1111 et al.                                          15

A true Copy:
        Teste:

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




                      USCA-02-C-0072—9-1-05