Light Sentence Affirmed in $33M Best Buy Fraud
(CN) - A woman who conspired to steal $33 million from Best Buy - one of the largest corporate frauds in Minnesota history - was properly sentenced to only three years probation, the 8th Circuit ruled.
Abby Rae Cole, her husband, and a Best Buy employee stole nearly $33 million from the store and evaded over $3 million in taxes over the course of four years, according to the ruling.
Cole was found guilty in Minnesota of conspiracy to commit mail and wire fraud, tax evasion, and conspiracy to commit tax fraud, and sentenced to three years probation.
"It would be a travesty of justice if I sent you away for a long period of time," U.S. District Judge Michael Davis wrote. "I am taking a huge chance on you."
The government appealed the sentence as substantively unreasonable, however, as the advisory guidelines advise about 11 to 14 years imprisonment for such crimes.
Though the 8th Circuit affirmed the convictions last year, it deferred ruling on the rationality of the lower sentence, insisting that the district court supplement its "scant explanation" for the deviation.
The lower court ultimately explained its reasons, noting the many restrictions Cole endured while on probation and the "lifelong restrictions" she faces as a federal felon in this "unusual, extraordinary case."
The court added that, "with family support and stable employment," Cole is less likely to commit further crimes, and able to make restitution to the victims of the fraud.
While "[t]his was one of the largest corporate frauds in Minnesota history and was also a significant tax fraud," Cole served a more minor role as "mostly a passive, although legally responsible, participant," according to the ruling.
Indeed, Cole had no prior contact with law enforcement and was "markedly different" than "most of the fraudsters who appear before th[e] court," the ruling states.
Cole "is not a consummate fraudster, she is not a pathological liar," the judge added.
The feds again appealed, however, arguing that the court improperly based the sentence on Cole's socioeconomic status, restitution obligations, and loss of criminally derived income.
But the 8th Circuit affirmed the lower court's ruling Friday.
"The facts of Cole's fall from an industrious and highly successful entrepreneur to convicted felon and the loss of the bulk of her legitimately acquired assets cannot be denied," U.S. Circuit Judge Bobby E. Shepherd wrote for the three-judge panel. "We find no error in the district court's reference to these events."
The panel relied on its recent finding in United States v. Dautovic that a downward variance from the same guidelines range applicable to Cole to a 20-month sentence was substantively unreasonable, according to the ruling.
"While we do not minimize the seriousness of the crimes perpetrated by Cole and the staggering nature of the fraudulent scheme in which Cole was a participant, the district court here, unlike in Dautovic, has adequately explained the sentence and appropriately considered the section 3553(a) factors in varying downward to a probationary sentence," Shepherd wrote.
The judge later added: "For instance, the district court noted that Cole's role in the offense was mostly as a passive participant and Cole was not the typical white collar defendant the court had observed in similar criminal schemes. We find no error in the weighing of the section 3553(a) factors, and thus the district court did not abuse its substantial discretion in sentencing Cole to probation."