steven finkler government sentencing memo

-1-

UNITED STATES DISTRICT COURT DISTRICT OF CONNECTICUT

UNITED STATES OF AMERICA v. STEVEN FINKLER

3:13CR79(SRU) November 29, 2013

UNITED STATES’ MEMORANDUM IN AID OF SENTENCING

The government respectfully submits this memorandum in aid of sentencing for the

sentencing hearing of the defendant Steven Finkler, scheduled for December 4, 2012. For the

reasons provided below, this Court should sentence the defendant to 65 months incarceration, an

8-year term of supervised release, and restitution in the amount of $9,828.83.

INTRODUCTION

Webster’s New Collegiate Dictionary defines the word “incorrigible” as “incapable of

being corrected or amended; not reformable.” There is no better word to describe this defendant.

Since becoming an adult, he has repeatedly, flagrantly and with total disregard for the law

engaged in fraud, after fraud, after fraud. One mental health professional who assisted the

defendant described him as “a manipulative individual.” The defendant’s own brother described

him as a “vindictive” “nasty “scam artist” who “is not to be trusted.” The government herein

describes him as a recidivist of the worst order, who needs to be incarcerated for as long as

possible in order to punish him, send a message of general deterrence, and to protect the public

as it appears unlikely that any sentence will specifically deter this defendant from continuing his

life of crime.

Case 3:13-cr-00079-SRU Document 16 Filed 11/29/13 of 16

-2-

PROCEDURAL BACKGROUND

On September 15, 2010, the defendant commenced supervised release following his

discharge from custody for his most recent federal conviction. Just over a year later, on

November 10, 2011, he was arrested for violating the terms of that release as a result of his

several Connecticut State arrests for theft over the course of 2011. From November 10, 2011

until February 2012, his violation proceedings were continued and then transferred to the District

of Connecticut, where the defendant lived. This matter was docketed as United States v. Steven

Finkler, 3:11CR223-001(SRU). During this time, the defendant was on home detention. On

February 28, 2012, this Court detained the defendant pending sentencing for the violation at the

Donald W. Wyatt Detention Facility (“Wyatt”).

On June 22, 2012, at the request of the Government, this Court modified the terms of the

defendant’s supervision, releasing him from Wyatt on the conditions of home confinement and

GPS monitoring.

While on release, the defendant engaged in the crimes described below. On July 26,

2012, the defendant was arrested for violating the term of his supervisory release that prohibits

him from engaging in criminal activities. On April 23, 2013, the defendant pled guilty to an

Information charging him with one count of Bank Fraud in violation of 18 U.S.C. § 1344.

Pursuant to the plea agreement, the defendant also pled guilty to violating the terms of his

supervised release.

The violation of 18 U.S.C. § 1344 carries a maximum penalty of 30 years imprisonment

and a $1,000,000 fine. In addition, under 18 U.S.C. § 3583, the Court may impose a term of

supervised release of not more than five years to begin at the expiration of any term of


-3-

imprisonment. The defendant understands that, should he violate any condition of the supervised

release, he may be required to serve a further term of imprisonment of up to three years with no

credit for time already spent on supervised release.

The defendant also is subject to the alternative fine provision of 18 U.S.C. § 3571. Under

this section, the maximum fine that may be imposed on the defendant is the greatest of the

following amounts: (1) twice the gross gain to the defendant resulting from the offense; (2) twice

the gross loss resulting from the offense; or (3) the amount specified in the section defining the

offense which is $1,000,000.

As to the supervised release violation, the defendant faces a maximum penalty of two

years’ incarceration and not more than three years of supervised release.

Pursuant to his plea agreement, the defendant agreed that his adjusted offense level for

the bank fraud conviction was 13 and that his Criminal History Category was VI, resulting in a

range of 33 to 41 months of imprisonment, a fine range of $3,000 to $30,000, and a supervised

release term of 2 years to 5 years.

With respect to the violation, the defendant agreed that he faces a guideline range of 21-

24 months’ incarceration because his original Criminal History Category in the underlying case

was VI, the violation in that case is a Grade B violation for state claims of theft, U.S.S.G. §

7B1.1(a)(2), and the maximum statutory penalty for the supervised release violation is 24 months

under 18 U.S.C. § 3583(e).

The parties agreed that neither a downward nor an upward departure from either the 33 to

41 month sentencing range for the bank fraud conviction or the 21 to 24 months sentencing range

for the supervised release violation was warranted and that sentences within those agreed ranges


-4-

were reasonable. Accordingly, both parties agreed not to seek a departure or any adjustment not

set forth in the plea agreement. Moreover, the defendant agreed to not seek a non-Guidelines

sentence on either the bank fraud or supervised release violation. With respect to the sentence on

the supervised release violation, however, the parties reserved their respective rights to argue that

the sentence on the supervised release violation should be served concurrent, partially concurrent

or consecutive to the sentence as to the bank fraud conviction in this case.

FACTUAL BACKGROUND

Finkler committed each of the offenses listed below between June 22, 2012 and July 26,

2012 – the limited period of time when he was released at the Government’s request by this

Court.

1. The Charged Conduct: Sovereign Bank and Fidelity Brokerage Service

On July 19, 2012, a fraudulent check from Fidelity Brokerage Services, LCC made

payable to Finkler in the amount of $10,000.46 was deposited into Finkler’s pre-existing bank

account at Sovereign Bank. According to a Sovereign Bank loss prevention specialist, this check

was deposited at the drive-up window of Sovereign Bank’s Torrington branch.

Over the course of the next week, $9,828.83 was withdrawn from the account through

check card transactions, ATM withdrawals, and cashed checks made payable to Finkler’s wife.

The loss prevention specialist at Sovereign Bank explained that the Fidelity check

bounced on July 24, 2012. He then contacted National Financial Services (“NFS”), which is a

brokerage platform for Fidelity, on July 25, 2012, and they verified that this check was never

issued. Thus, Sovereign Bank classified the check as being counterfeit. Nonetheless, because

the NFS was the entity to first catch the fraud, Sovereign Bank had to refund the money, much of


-5-

which had already been withdrawn. Therefore, Sovereign Bank is the actual victim. Sovereign

Bank is FDIC insured.

2. Related Relevant Conduct

In addition to the fraud detailed above, Finkler engaged in similar frauds with different

victims. Specifically, while on release, he deposited fraudulent, forged checks from Torrington

Honda, Wyatt, and United States Life Insurance Company in the City of New York.

A. The Torrington Honda Fraud

On June 27, 2012, Steven Finkler deposited a forged check from Torrington Honda in the

amount of $6,229.00 into his account at Merrill Lynch (“Merrill”).

The check was dated June 22, 2012 – the day Finkler was released from Wyatt – and it

was made payable to Finkler. Finkler worked at Honda before he was arrested for violating his

post-conviction supervision. Employees of Torrington Honda have stated that the check had

been modified from their standard checks. Specifically, the check had only one signature as

opposed to their legitimate checks which have two signatures, that single signature was forged,

and the check number had been changed.

With respect to the last alteration, the forged check bore the check number “74956”.

Torrington Police informed the FBI that check number “34956” was issued by direct deposit to

Steven Finkler on March 4, 2011 in the amount of $160.00. This was Finkler’s final paycheck

from the business. According to the Torrington Honda employee, when paychecks are direct

deposited, an actual check is not issued. Rather, the employee receives a paystub, attached to

which is a check on which is stamped “Non-negotiable.”


-6-

According to representatives from Merrill, the forged check was deposited via mobile

deposit into a pre-existing account held in Finkler’s name. Mobile deposit allows the depositor

to photograph the check and submit it electronically. The Merrill account had been opened with a

$100.00 deposit just days before Finkler was detained on his violation of supervised release. The

account lay dormant until June 22, 2012 – the day that Finkler was released. At that point, the

account was almost entirely drawn down and remained so until the Honda forged check was

deposited on June 26, 2012.

According to Merrill and the issuing bank – Union Savings Bank – the check was vacated

and never cleared into Finkler’s account. Thus, there was no actual loss.

B. The Wyatt Fraud

On the day of his release, Finkler requested in writing that Wyatt send him a check for

the remaining funds in his commissary and phone accounts. On July 11, 2012, Wyatt issued

check number 108326 in the amount of $22.82, which represented that balance, made payable to

Steven Finkler and sent it to Finkler’s home.

On July 16, 2012, a check bearing the same check number, purportedly issued from

Wyatt to Finkler in the amount of $6,022.82 was negotiated. Documents from and interviews

with Wyatt personnel confirm that Wyatt never issued a check in the amount of $6,022.82 to

Finkler.

According to officials from Bank of America, the bank at which Wyatt maintains its

account, and Merrill, this check was negotiated through Finkler’s account at Merrill. Both

officials confirmed that the check was negotiated via mobile deposit. On July 23, 2012, the

original Wyatt check for $22.82 was negotiated through a Webster bank account.


-7-

According to officials from Merrill and Bank of America, the check was vacated and

never cleared into Finkler’s account. Thus, there was no actual loss.

C. United States Life Insurance Co. in the City of New York Fraud

According to officials at Merrill, Finkler deposited three checks from United States Life

Insurance Company in the City of New York that were subsequently deemed fraudulent.

On July 2, 2012, the following two checks from this institution were deposited into

Finkler’s Merrill account via mobile deposit: (1) check number 5134472 in the amount of

$3,200.00 and (2) check number 5134473 in the amount of $7032.00, both made payable to

Steven Finkler. On July 9, 2012, check number 5135473 from this insurance company made

payable to Steven Finkler in the amount of $7,032.00 was deposited via mobile deposit into

Finkler’s Merrill account. All of these checks were drawn on an account at Bank of America.

According to officials at Merrill, Bank of America contacted them shortly after the

deposit, informing them that the checks were fraudulent. According to officials from Merrill, the

checks were vacated and never cleared into Finkler’s account. Thus, there was no actual loss.

3. Finkler’s Prior Criminal Record

The Pre-Sentence Report in this case provides extensive detail about this defendant’s

prior criminal conduct. It establishes that the defendant began his criminal career in 1982 at the

age of 18 by stealing a small sum of money from a cash register at a store where he worked.

Over the course of the next nine years, the defendant engaged in a series of petty scams and

larcenies, but ultimately cultivated more extensive and elaborate schemes that led to the first of

what would be four federal fraud convictions. As detailed below, the defendant often committed

these crimes while on supervised release and in one instance, while he was incarcerated. His


-8-

victims ranged from individuals to companies. Indeed, he even used his own mother in

furtherance of his fraud.

A. The First 1993 E.D.N.Y. Conviction and the 1998 Supervised Release Violation

As detailed in the PSR, over the course of a single year from June 1990 through June

1991, the defendant operated a fraudulent telemarketing operation which involved selling and

receiving payment for merchandise through fraudulent representations; demanding payment

from victims for shipments of merchandise they did not order; making unauthorized charges on

victims' credit card accounts and making unauthorized charges on stolen credit cards. The

fraudulent orders taken from 30 victims totaled $133,739.43. For this crime, the defendant was

sentenced on April 16, 1993 to 46 months in prison and three years of supervised release. He

was released from custody on March 14, 1997.

Within six months of his release, he engaged in yet another fraud. Using his position as

an employee at a long distance telephone service provider, the defendant defrauded a customer

out of goods worth approximately $280,000. When confronted by the victim, the defendant

allegedly hit the victim over the head with a metal chair and fled from the store. For this

violation, the defendant was sentenced on April 10, 1998 to 24 months in prison.

B. The Second 1993 E.D.N.Y. Conviction

While on bond for the federal fraud detailed supra, the defendant engaged in a further

fraudulent scheme. Specifically, within three months of his arrest for the previously discussed

fraud, the defendant entered into a fraudulent agreement with a company called CSM

Environmental System, Inc. (CSM) pursuant to which CSM acquired Finkler Laboratories, Inc.,

and employed the defendant to run a newly established subsidiary of CSM, called CSM


-9-

Environmental Laboratories, Inc., (CSM Labs). On the Employment Agreement, Finkler made

two false representations to CSM: (1) he denied having any pending litigation against him, when

in fact, he had been arrested and indicted and (2) he submitted to CSM a 1990 Federal Corporate

Tax Return that showed he made $1,803,541 in sales for 1990 when in fact he had only made

$272,394.

At the end of August 1991, CSM issued a check to Finkler for $25,000 as a lump sum

advance payment for having entered into the Employment Agreement. While employed at CSM,

Finkler submitted fraudulent business expense reimbursement vouchers to CSM for which CSM

paid him a total of $63,469,60. He used all of this money his personal gain, buying two Rolex

watches, a 1992 leased BMW, a mink coat, and making payments on his former condominium in

Great Neck, New York, Notably, the checks were made payable to various individuals and

filtered through their accounts, with proceeds given to the defendant in return for his payment to

the individuals he solicited. Finally, CSM estimated that 75 percent of all the sales the defendant

claimed were made by his subsidiary (approximately $175,000) were false.

For this fraud conviction, he was sentenced on April 16, 1993 to 46 months in prison to

run concurrently with his other federal sentence and, for committing the crime while on bail, he

was sentenced to 11 months imprisonment to run consecutively.

C. The 2002 S.D.N.Y. Conviction

The defendant, while an employee of Teligent Inc., a telecommunications company,

defrauded the company by submitting fraudulent sales contracts in order to receive commissions.

He did this by forging names and signatures, making false statements and submitting false

documents. Mr. Finkler was responsible for a loss of between $30,000 and $70,000. The Court


-10-

ordered that Mr. Finkler undergo psychiatric testing and treatment. For this conviction, the

defendant was sentenced on January 3, 2002 to twenty-seven months in prison and three years of

supervised release.

D. The 2005 E.D.N.Y. Conviction

In this case, the defendant engaged in three distinct frauds, some of which occurred

within months of his arrest for the Teligent fraud and two of which occurred while he was

incarcerated. In the first, over the course of a year from February 2001 and to January 2002, the

defendant falsely represented to a colleague that the defendant had real estate investment

opportunities with Chase Properties in which the colleague could invest. In order to convince the

colleague of the legitimacy of the investments, the defendant created emails which purported to

come from real Chase employees. The emails provided information about the investments,

specifically, real property for sales at reduced rates. Through the course of the scheme, the

colleague provided the defendant with a total of $59,571 for alleged down payments and other

related expenses for the real estate. The money was never repaid. When the colleague attempted

to locate the defendant to demand repayment, the defendant instructed an associate to tell him

that the defendant suffered a heart attack and was hospitalized. Moreover, when the colleague

contacted the defendant’s wife to corroborate the story, the defendant’s wife, Sara Finkler,

implied that her husband was in the hospital, when in fact, he was incarcerated at the Federal

Correctional Institute at Fort Dix, New Jersey.

The defendant perpetrated the second fraud while incarcerated at Fort Dix. There, he

defrauded a fellow inmate of $17,875 by falsely representing to him that the defendant was

investing money in a non-existent company, Infoport Communications Group (“ICG”) and that


-11-

the inmate could do so as well at a discount prior to an initial public offering of the company’s

shares. At the defendant’s direction, the inmate wrote a check to We Got It, Inc. (“WGI”) – a

company that the defendant purported was a clearinghouse of ICG. WGI was a company

incorporated in the State of New York on August 29, 2000 and the defendant and his wife were

listed as its officers. In March 2002, Steven Finkler instructed his wife to open a bank account at

JP Morgan Chase in the name of WGI. That account listed Sara Finkler as the president of WGI

and signatory on the account. She later deposited the inmate’s check for $17,875 into the

account.

The final scheme occurred between August 2000 and January 2003 – both before and

during his incarceration. In this scheme the defendant obtained numerous credit cards from

various credit card issuers. On most of the accounts, he was either a joint card holder with his

mother or an authorized user of cards of which his mother was the primary holder. He ran up

charges in these accounts, leaving unpaid balances. When the credit card issuers sought payment,

the defendant forged correspondence and bank documents to create the appearance that his

mother was writing to the issuers, claiming their identities had been stolen and that they had not

incurred the charges. At this time, Finkler's mother was either in the final stages of cancer or

deceased. The case agent advised that the fraud loss totaled $412,996.80.

For these schemes, the defendant was sentenced on October 28, 2005 to 92 months in

prison and three years of supervised release. Within less than one year of his release from prison

for this conviction, the defendant committed the Connecticut State crimes that led to his

supervised release revocation in the instant case.


-12-

DISCUSSION

As the facts establish, the defendant is a perpetual recidivist, who has defrauded

individuals and institutions alike. He has committed these crimes – including the instant

offenses – while on supervised release in flagrant disregard of court orders. He has no moral

compass and there is nothing that this Court, Probation or the Government can do to instill him

with one. The need to stop him from committing further crimes against more victims requires

him to be institutionalized for as long as reasonable: 65 months.

The Sentencing Standards

In accordance with the Supreme Court’s decision in United States v. Booker, 543 U.S.

220 (2005), and the Second Circuit’s decision in United States v. Crosby, 397 F.3d 103 (2d Cir.

2005), the sentence to be imposed must be reached through consideration of the advisory

Guidelines and all of the factors identified in 18 U.S.C. § 3553(a). In so doing, the Court has a

statutory responsibility “to ‘impose a sentence sufficient, but not greater than necessary’ to

accomplish the goals of sentencing,” Kimbrough v. United States, 552 U.S. 85, 102 (2007)

(quoting 18 U.S.C. § 3553(a)).

The Guidelines, consisting of offense characteristics and various grounds for departure,

address all of the considerations relevant to sentencing, as articulated in 18 U.S.C. §3553

including, but not limited to “(1) the nature and circumstances of the offense and the history and

characteristics of the defendant; (2) the need for the sentence imposed -- (A) to reflect the

seriousness of the offense, to promote respect for the law, and to provide just punishment for the

offense; (B) to afford adequate deterrence to criminal conduct; (C) to protect the public from

further crimes of the defendant; and (D) to provide the defendant with needed educational or


-13-

vocational training, medical care, or other correctional treatment in the most effective manner; ...

(6) the need to avoid unwarranted sentence disparities among defendants with similar records

who have been found guilty of similar conduct; and (7) the need to provide restitution to any

victims of the offense.” Accordingly, in determining an appropriate sentence for the defendant,

the Court must take into account all of the factors delineated in Section 3553.

The Nature And Circumstances Of The Offense And The History And Characteristics Of The Defendant Support A Sixty-Five Month Guideline Sentence.

The crime for which the defendant was convicted and the related crimes that are included

in his sentencing calculation were serious in so far as they demonstrate a wild hubris, selfishness,

and disrespect for the law. These are the very same characteristics that mark this defendant. For

these reasons, a 65-month sentence is just.

Although the fraud amount in this case includes intended loss amounts, the government is

not using those amounts as a proxy for the defendant’s dangerousness. Rather, the resulting

Guideline range of 33 to 41 months is appropriate because the defendant is actually dangerous.

Indeed, while the government remains committed to its plea agreement, it is respectfully

submitted that 33 to 41 months grossly understates the danger that this defendant poses to

society. In this regard, this case is wholly inapposite to United States v. Corsey, 723 F.3d 366

(2d Cir. 2013). Moreover, unlike the crime in Corsey, the fraud amount here contains one

consummated fraud and the unconsummated frauds were neither “clumsy” nor “almost comical”.

They involved well-constructed forgeries that failed because the victims had better constructed

fraud prevention methods.

Additionally, unlike the defendants in Corsey, who had either no or minimal criminal

records, this defendant has demonstrated a significant commitment to crime. Despite (1) the


-14-

efforts of the judicial and probation systems to help him and (2) significant sentences because of

which he spent long periods of time away from his loved ones, the defendant has committed

fraud at every opportunity. Indeed, the attached timeline demonstrates that during most of the

last twenty-four years, the defendant has been victimizing others. (See Exhibit A (providing a

timeline of the defendant’s crimes, arrests and sentences based on the PSR).)

Beyond the overwhelming number of prior convictions, their facts and the facts of the

instant case also counsel in favor of a significant sentence. While not particularly sophisticated

or complex, the hubris of the crimes is staggering; it is respectfully submitted that few

defendants would be so bold as to rip off the very jail that had housed them while on supervised

release. But in that way, this crime is no less offensive than his past crimes, where he defrauded

a fellow inmate while incarcerated or used his dying mother’s identity as means to get money.

All of these facts support the Government’s position that it is appropriate and necessary

to incarcerate him now for as long as possible.

In Order To Promote Respect For The Law, Provide A Just Punishment For The Offense And Protect The Public, A Sixty-Five Month Sentence Should Be Imposed.

Since he was eighteen, the defendant has sustained four federal fraud convictions. As a

result of these convictions, the defendant has been sentenced to more than sixteen years in

prison. Thus, he has spent a significant part of his adult life in custody, where a myriad of people

have attempted to address his deficient character. But these sentences – many of which were

greater than that which the government seeks herein – and that help have done nothing to stop

the defendant. Given the opportunity, he will re-offend. The question for this Court is when.

The government contends that it should not be until after he has served 65 months.


-15-

CONCLUSION

For the reasons set forth above, the Government respectfully submits that a sixty-five

month term of incarceration followed by eight years of supervisory release and restitution as

outlined herein and as set forth in the Plea Agreement, dated April 23, 2013, is appropriate and

should be imposed in this case.

Dated: November 29, 2013

Bridgeport, CT Respectfully submitted,

DEIRDRE M. DALY ACTING UNITED STATES ATTORNEY

By: /s/

VANESSA RICHARDS ASSISTANT UNITED STATES ATTORNEY

Bar Number: PHV 05095 UNITED STATES ATTORNEY’S OFFICE

1000 LAFAYETTE BOULEVARD BRIDGEPORT, CT 06604


-16-

CERTIFICATE OF SERVICE I hereby certify that on November 29, 2013, a copy of the above submission was filed electronically. Notice of this filing will be sent by email to all parties by operation of the Court’s electronic filing system or by mail to anyone unable to accept electronic filing as indicated on the Notice of Electronic Filing. Parties may access this filing through the Court’s CM/ECF System. /s/ VANESSA RICHARDS

ASSISTANT UNITED STATES ATTORNEY PHV 05095 (203) 696-3000


1

Commits CSM Fraud and NYS insurance fraud (EDNY)

Sept. 1991 – app. Mar. 1992

Arrested for CSM fraud (EDNY)

Mar. 1992

June 1990 -app.

June 1991

Commits PLI telemarketing fraud (EDNY)

June 1991

Arrested for PLI telemarketing fraud (EDNY)

Jan. 1998

Arrested for violation of supervised release (EDNY)

Sept. 1997

Commits supervised release violation: Fraud on telephone company customer

A Timeline of Crime: 1990-2012 Commits Teligent fraud (SDNY)

Some time between

April 2000 and Feb. 2001

Arrested for Teligent fraud (SDNY)

Incarcerated June 1993 – Mar. 1997

Incarcerated for Teligent fraud

Jan. 2002 – app. May 2003

Incarcerated Apr. 1998–

app. Apr. 2000

Feb. 2001

Feb. 2001 – Jan. 2002

Aug. 2002

Commits Chase real estate fraud (EDNY)

Arrested for Chase real estate, Fort Dix, and credit card frauds (EDNY)

Commits IPO fraud (Fort Dix )

Aug. 2000 – Jan. 2003

Commits credit card fraud

Oct. 2003

Incarcerated Oct. 2003 –

Sept. 2010

Feb. 2011 – Feb. 2012

Commits supervised release violation: various CT frauds

June – July 2012

Commits the instant bank fraud

Feb. 2012

Federally arrested for supervised release violation (SDNY/EDNY)

Incarcerated Feb. – June

2012

Case 3:13-cr-00079-SRU Document 16-1 Filed 11/29/13 Page 1 of 1