Not what you're
looking for? Try an advanced search.
Buy This Entire Record For
United States v. Woolsey
United States District Court, E.D. Michigan, Southern Division
February 15, 2018
UNITED STATES OF AMERICA, Plaintiff/Respondent,
RICHARD DEAN WOOLSEY, Defendant/Petitioner.
MEMORANDUM AND ORDER DENYING MOTION UNDER 28 U.S.C.
§ 2255 (Doc. 130) AND DECLINING TO ISSUE A CERTIFICATE
COHN U.S. DISTRICT JUDGE
a criminal case. Defendant/Petitioner Richard Dean Woolsey
(Woolsey) was found guilty by a jury of conspiracy to commit
mail and wire fraud and wire fraud. The Court sentenced
Woolsey to 90 months imprisonment. Woolsey timely appealed.
The Court of Appeals for the Sixth Circuit affirmed.
United States v. Woolsey, No. 14-1693/2488
(6th Cir. Jan. 22, 2016).
the Court is Woolsey's pro se motion under 28
U.S.C. § 2255. (Doc. 130). The government has filed a
response (Doc. 145) and Woolsey a reply (Doc. 148). For the
reasons that follow, the motion will be denied.
background, including the facts leading to Woolsey's
convictions and relevant Court proceedings have been
described by the Sixth Circuit as follows:
A. The Scheme
Sometime around 2006, Woolsey devised a plan to fraudulently
buy sixteen cabins in Sevierville, Tennessee, for use as
vacation rentals. The scheme worked as follows. Woolsey
recruited straw buyers from among friends and family,
including co-defendant Ryan Vinco (who is not a party to this
appeal), marketing the properties as investment
opportunities. He managed to set the purchase prices for
these cabins higher than the sellers had agreed to accept,
funneling the excess (about $150, 000 per cabin) to the real
estate company that he owned in the form of commissions.
Unbeknownst to the lenders, Woolsey, not the straw buyers,
provided the money for the down payments and used rental
income from the properties as well as money from the
commissions to make the mortgage payments.
Woolsey overestimated the demand for these rentals, however,
and it soon became evident that the rental income and
commissions were going to be insufficient to keep up with the
mortgage payments. To cover the shortfall, Woolsey decided to
buy up homes in southeastern Michigan in order to flip them
for a profit or to refinance them.
Woolsey and Vinco purchased dozens of homes in Michigan using
a straw buyer ploy similar to the one used to buy the
Tennessee cabins. These purchases involved $2, 500 payments
to the straw buyers in exchange for their names and credit.
As in Tennessee, the straw buyers did not pay the down
payments and did not expect to pay the mortgages. Woolsey
would then sell the properties and include large commissions
to his real estate company, which he used to pay off the
Tennessee mortgages and to help fund down payments for straw
The Michigan houses, however, failed to provide the necessary
cash, and Woolsey and Vinco decided to make a last-ditch
effort to keep up with the mounting mortgage obligations.
Woolsey acted as straw buyer for a property in Northville,
Michigan (the Clover Hill property). He applied for an $880,
000 loan, stating, falsely, that he intended to live in the
house. An appraiser who worked for Woolsey then appraised the
Clover Hill property at $1.1 million. In fact, the Clover
Hill property was worth only about $663, 000. Woolsey
convinced the seller to accept $610, 000 for the house, and
the excess loan money went to Woolsey's real estate
business as a commission.
Woolsey made only two payments on the mortgage, and the
lender eventually foreclosed. Woolsey was indicted and
convicted on charges of Conspiracy to Commit Mail and Wire
Fraud and of Aiding and Abetting Wire Fraud.
Following Woolsey's convictions, the probation department
recommended a sentencing range of 168-210 months based on a
loss amount of at least $11 million. Woolsey submitted his
own calculation, ostensibly to point out the errors in the
government'|s proposed loss amount, which put the losses
at roughly $2, 750, 000. At the sentencing hearing, the
district court accepted Woolsey's lower number and
reduced the guidelines range to 97-121 months. After
explaining its calculation, the district court asked if
“anyone ha[d] any objection . . . to anything I have
said.” The government responded that it did not. And
defense counsel stated that, “as far as the advisory
guidelines, I would concur . . . I would concur with the
guideline range at this point, your honor.” The
district court varied downward from the guideline range and
sentenced Woolsey to ninety months of imprisonment followed
by three years of supervised release.
With regard to restitution, the government initially
estimated the loss at $11 million. It based this
determination on evidence and testimony at trial as well as
from investigative subpoenas, payment histories, and public
records. Woolsey disputed this amount, and the government
revised its estimate by disregarding every property that
Woolsey had said that he was not involved with, giving him
credit for every payment he claimed to have made, and
correcting the mortgage amounts he disputed. It then reduced
the loss by the resale price of each piece of property. Thus,
for example, it concluded that the lender on the Clover Hill
property lost $488, 000 using the following calculation:
Mortgage ($880, 000) -Mortgage Payments Made ($17, 000) -
Resale Price ($375, 000). The district court accepted the
government's approach and ordered Woolsey to pay $6, 167,
230.83 in restitution.
United States v. Woolsey, No. 14-1693/2488 at p.
Buy This Entire Record For