Fraud Sentencing in the Seventh Circuit: Intended-Loss Reliance on a Reliable PSR and § 2B1.1(b)(9)(A) Applied to a “Non-Existent” Government Agency

1. Introduction

United States v. Minister Zakar Ali (7th Cir. July 17, 2026) arises from a multi-prong fraud conspiracy involving (i) fraudulent COVID-relief loan applications (PPP and EIDL), (ii) unemployment insurance claims, and (iii) vehicle-title/lien fraud. The defendants—Minister Zakar Ali (a/k/a Anthony Allen) and Aziz Hassan Bey (a/k/a Chauncey Hooks), along with two codefendants—represented themselves at trial and were convicted on all counts.

On appeal, the principal issues were sentencing-driven: (a) whether the district court overstated loss under U.S.S.G. § 2B1.1(b)(1) by adopting an intended-loss figure supported by the PSR, (b) whether the two-level enhancement for misrepresenting action on behalf of a government agency under U.S.S.G. § 2B1.1(b)(9)(A) applies when the “agency” is not real, and (c) whether Ali’s below-guidelines sentence was substantively unreasonable. Ali also raised multiple claims (discovery, sufficiency, restitution, minor-role) that the court treated as forfeited and reviewed only for plain error.

2. Summary of the Opinion

  • Loss amount: The court upheld the district court’s adoption of the PSR’s intended-loss calculation (nearly $11 million) and the resulting 20-level increase under § 2B1.1(b)(1)(K), rejecting Bey’s attempt to rely on a lower “actual loss” number from grand-jury testimony.
  • Government-role enhancement: The court affirmed the § 2B1.1(b)(9)(A) two-level increase for holding oneself out as acting for a governmental entity, concluding it may apply even where the purported government agency is not actually a government agency (here, the “Consulate of al Moroc”).
  • Substantive reasonableness: The court affirmed Ali’s 140-month below-guidelines sentence, treating it as presumptively reasonable and deeming his appellate argument undeveloped.
  • Forfeiture and plain error: The court rejected Ali’s unpreserved claims (discovery, sufficiency, restitution, minor-role) under plain-error review.

3. Analysis

A. Precedents Cited

1) Loss methodology and intended vs. actual loss

  • United States v. Banks, 55 F.4th 246 (3d Cir. 2022): Raised below as support for using “actual loss” rather than intended loss under § 2B1.1(b)(1). The Seventh Circuit notes the argument was abandoned on appeal.
  • United States v. Ponle, 110 F.4th 958 (7th Cir. 2024): Supplies the governing Seventh Circuit rule—district courts use “the greater of the actual loss or intended loss” (tracking the Guidelines framework). This opinion treats Ponle as dispositive on the “actual vs. intended” debate.
  • United States v. Griffin, 76 F.4th 724 (7th Cir. 2023): Provides both the standard of review (clear error for loss findings) and the key burden-shifting framework when the court relies on a PSR: a well-supported PSR can satisfy the government’s burden; the defendant must then show inaccuracy and cast “real doubt” to shift the burden back.
  • United States v. Salem, 597 F.3d 877 (7th Cir. 2010): Cited for the proposition that a defendant’s responsibility for loss may depend on foreseeability within jointly undertaken criminal activity; Ali’s attempt to invoke this principle fails given trial evidence of his involvement.

2) Misrepresenting a government role under § 2B1.1(b)(9)(A)

  • United States v. Cohen, 159 F.4th 1121 (7th Cir. 2025): Establishes the review framework invoked here (de novo for preserved Guidelines-application issues; also cited later for forfeiture of Guidelines issues not raised at sentencing).
  • United States v. Sunmola, 887 F.3d 830 (7th Cir. 2018): Provides the controlling interpretation that § 2B1.1(b)(9)(A) applies to a defendant who purports to act on behalf of a government agency while intending personal benefit—supporting the enhancement for “Consulate of al Moroc” representations.

3) Appellate review of reasonableness and sentencing procedure

  • United States v. Martin, 122 F.4th 286 (7th Cir. 2024): Cited for the review approach the panel applies to the substantive-reasonableness claim.
  • United States v. Guzman-Ramirez, 949 F.3d 1034 (7th Cir. 2020): Supplies the presumption of reasonableness for within- or below-guidelines sentences.
  • United States v. Butler, 58 F.4th 364 (7th Cir. 2023): Used to dispose of an undeveloped sentencing argument where the appellant does not meaningfully engage with the presumption of reasonableness.
  • United States v. Washington, 178 F.4th 360 (7th Cir. 2026): Frames a sentencing court’s duty to address mitigating arguments and provide an individualized § 3553(a) assessment; the panel distinguishes it because Ali did not present mitigating arguments at sentencing when invited.

4) Preservation, forfeiture, and plain-error review

  • United States v. Wright, 85 F.4th 851 (7th Cir. 2023): Holds a sufficiency challenge is forfeited absent a Rule 29 motion.
  • United States v. Grusd, 164 F.4th 635 (7th Cir. 2026): Cited for forfeiture of restitution objections not raised below and for the plain-error framework.
  • United States v. Page, 123 F.4th 851 (7th Cir. 2024) (en banc): Supplies the canonical four-part plain-error test as quoted via Grusd.
  • United States v. Vizcarra-Millan, 15 F.4th 473 (7th Cir. 2021): Quoted (through Griffin) for the “nearly insurmountable hurdle” facing sufficiency challenges on appeal given deference to the verdict.
  • United States v. Hofschulz, 105 F.4th 923 (7th Cir. 2024): Reinforces “great deference” to the jury’s verdict in sufficiency review.
  • United States v. Gan, 54 F.4th 467 (7th Cir. 2022): Clarifies doctrinally that conspiracy and substantive counts can diverge—acquittal on conspiracy does not preclude conviction on substantive offenses—undercutting Ali’s “domino” argument.
  • Harris, 102 F.4th at 852: Used to emphasize that on plain-error review appellate courts are reluctant to reverse where doing so would require the trial judge to have raised and resolved complex, fact-intensive matters sua sponte (here, fine-grained restitution allocation/accounting issues).

B. Legal Reasoning

1) Loss under § 2B1.1(b)(1): the PSR-driven, burden-shifting approach

The court’s analysis is anchored in United States v. Griffin’s framework: a reliable, well-supported PSR may establish loss by a preponderance; the defendant must then show the PSR is inaccurate and raise “real doubt” about its reliability. Bey’s principal rebuttal—grand-jury testimony reflecting a much lower actual loss—did not contradict the PSR’s intended loss computations for the three component schemes. With no evidentiary showing undermining the PSR’s intended-loss totals, the district court’s adoption of the PSR was not clearly erroneous.

The court also notes that the “actual vs. intended loss” dispute has been resolved in this circuit by United States v. Ponle (use the greater of actual or intended). Although Bey and Ali initially argued for the Third Circuit’s United States v. Banks approach, they abandoned that argument on appeal.

2) § 2B1.1(b)(9)(A): “government agency” misrepresentation can include a sham agency

Applying United States v. Sunmola, the panel reads § 2B1.1(b)(9)(A) to target defendants who purport to act for a government entity while seeking personal benefit. The key move is the court’s refusal to treat the “Consulate of al Moroc” as exempt merely because it is not, in reality, a foreign government agency. The opinion analogizes to the Guidelines’ own example (in commentary) involving solicitations for a non-existent famine relief organization, concluding there is no meaningful distinction between a fake charity and a fake government agency for purposes of the enhancement’s fraud-aggravating rationale: the defendant trades on institutional legitimacy to gain victims’ trust.

3) Substantive reasonableness: presumption plus waiver-by-underdevelopment

Ali’s below-guidelines sentence triggered the presumption of reasonableness described in United States v. Guzman-Ramirez. The court, invoking United States v. Butler, rejected Ali’s challenge because he did not grapple with the presumption or offer a developed argument overcoming it. When counsel attempted at oral argument to recast the claim as procedural, United States v. Washington supplied the governing principle (district courts must address mitigating arguments), but the panel found it inapplicable: Ali did not present those mitigating points at sentencing when the judge invited him to do so.

4) Forfeiture and plain error: self-representation does not relax preservation rules

The court treated several of Ali’s claims as forfeited due to failures to raise them in the district court: United States v. Wright foreclosed preserved sufficiency review absent a Rule 29 motion; United States v. Grusd and United States v. Page governed plain-error review for restitution and other unpreserved sentencing issues. Under that demanding standard, the panel held that the record did not show an obvious discovery violation requiring a hearing, the evidence of conspiracy was ample, restitution accounting was too fact-intensive to deem plainly erroneous (reinforced by Harris), and a minor-role adjustment was not clearly warranted given evidence of Ali’s significant involvement.

C. Impact

  • Sentencing practice—loss disputes: The decision reinforces that in the Seventh Circuit, a defendant contesting an intended-loss figure must do more than cite alternative numbers (e.g., actual loss from grand-jury testimony). Without evidence that creates “real doubt” about PSR reliability, district courts may adopt PSR intended-loss totals, and appellate courts will defer under clear-error review.
  • “Fake authority” enhancements: The court’s treatment of the “Consulate of al Moroc” signals that § 2B1.1(b)(9)(A) can be triggered by claiming governmental status even when the “agency” is a sham or legally non-governmental—so long as the defendant held it out as governmental and used it to facilitate personal gain.
  • Preservation lessons (especially for pro se defendants): The opinion underscores that failing to make a Rule 29 motion, to object to restitution calculations, or to litigate Guidelines adjustments at sentencing will generally confine appellate review to plain error—often a decisive barrier in fraud cases with voluminous records.

4. Complex Concepts Simplified

Intended loss vs. actual loss
“Actual loss” is what victims actually lost; “intended loss” is what the defendant meant to cause (or attempted to obtain). Under Seventh Circuit practice referenced here (via United States v. Ponle), the Guidelines loss figure is the greater of the two.
Presentence Investigation Report (PSR) and burden shifting
A PSR is the probation office’s sentencing report. If it is detailed and reliable, it can establish key sentencing facts (like loss). Then the defendant must show it is wrong; if he raises “real doubt,” the government must prove the fact again with additional support.
Enhancement for acting on behalf of a government agency (§ 2B1.1(b)(9)(A))
This adds levels if a defendant pretends to act for a government body (or similar authority) to make the fraud more believable. This opinion applies the enhancement even when the “government agency” is not real, because the harm lies in exploiting perceived official legitimacy.
Forfeiture and plain error
If a defendant does not raise an argument at the right time in the district court, the issue is “forfeited.” On appeal, the court usually reviews only for “plain error,” which is difficult to satisfy because the error must be obvious and outcome-affecting.

5. Conclusion

United States v. Minister Zakar Ali affirms substantial fraud sentences and restitution while sharpening several practical points: reliable PSRs can carry the government’s burden on intended-loss calculations unless the defendant produces evidence creating “real doubt”; the § 2B1.1(b)(9)(A) enhancement can apply when defendants trade on the appearance of governmental authority even through a sham “agency”; and unpreserved trial and sentencing claims—especially in complex fraud prosecutions—rarely survive plain-error review.