No. 22-1918

UNITED STATES,

Appellee,

v.

ALEJANDRO CORTÉS-LÓPEZ,

Defendant, Appellant.

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF PUERTO RICO

[Hon. Francisco A. Besosa, U.S. District Judge]

Before

Rikelman, Hamilton,* and Thompson, Circuit Judges.

Franco L. Pérez-Redondo, Assistant Federal Public Defender, with whom Héctor L. Ramos-Vega, Interim Federal Public Defender, was on brief, for appellant.

Maarja T. Luhtaru, with whom W. Stephen Muldrow, United States Attorney, and Mariana E. Bauzá-Almonte, Assistant United States Attorney, were on brief, for appellee.

May 10, 2024

* Of the Seventh Circuit, sitting by designation. THOMPSON, Circuit Judge. Alejandro Cortés-López is serving a 24-month term of imprisonment after pleading guilty to conspiracy to commit mail and wire fraud. In this direct appeal, he asks this court to vacate his sentence and remand to the district court because the government, he asserts, breached the plea agreement during the sentencing hearing. On plain error review, we conclude the government did just that. We therefore vacate Cortés' sentence and remand for further proceedings.

HOW CORTÉS GOT HERE1

In July 2020, a grand jury indicted Cortés and a co- defendant with conspiracy to commit mail and wire fraud, one count of securities fraud, and several substantive counts of wire fraud. In March 2022, Cortés entered into a plea agreement with the government, stipulating that, from 2010 to 2017, he perpetrated a fraudulent financial scheme in which he solicited residents in Puerto Rico to invest in short-term, high-interest loans in the Dominican Republic through The Republic Group, Inc., a Florida corporation. Cortés stipulated that he used the money from the investors to pay himself and to distribute supposed returns on prior investments to the earlier investors -- so-called "lulling payments" -- so the investors were further duped "into a false

1 We draw the relevant facts presented herein from the plea agreement, the undisputed parts of the presentence investigation report, and the sentencing transcript. See United States v. Ubiles-Rosario, 867 F.3d 277, 280 n.2 (1st Cir. 2017).

- 2 - sense of security that their investments were safe and performing as promised." Cortés copped to his actions, agreeing to plead guilty to conspiracy to commit mail and wire fraud.

In the plea agreement, the parties agreed that the sentencing guidelines calculation would lead to a total offense level (TOL) of 18. Important for the discussion to come, the agreement's TOL contemplated a 14-level enhancement for the agreed-to $749,200 loss amount, which, when combined with a criminal history category of I (Cortés had no prior arrests or convictions), would suggest a guidelines sentencing range (GSR) of 27-33 months' imprisonment. Nonetheless, the parties promised to jointly request a variant sentence of 24 months' probation regardless of the court's final TOL calculation. In addition, the government agreed to move to dismiss the other counts in the indictment still pending at the time of sentencing. For his part, Cortés waived his right to appeal the sentence if the sentence imposed by the district court was within or below the sentence recommendation agreed to by the parties. The district court accepted Cortés' change of plea in April.

According to the Presentence Investigation Report (PSR), Cortés' and his co-defendant's financial fraud scheme resulted i