United States v. Lewis

• Decision Date: 14 February 1969
• Docket Number: No. 16227.,16227.
• Citation: 406 F.2d 486
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Milton W. LEWIS and Lee Roy Sohn, Defendants-Appellants.
• Court: U.S. Court of Appeals — Seventh Circuit

406 F.2d 486 (1969)

UNITED STATES of America, Plaintiff-Appellee, v. Milton W. LEWIS and Lee Roy Sohn, Defendants-Appellants.

No. 16227.

United States Court of Appeals Seventh Circuit.

January 29, 1969.

Rehearing Denied February 14, 1969.

COPYRIGHT MATERIAL OMITTED

Charles A. Bellows, Jason E. Bellows, Sherman C. Magidson, Harry J. Busch, Chicago, Ill., for defendants-appellants; Bellows, Bellows & Magidson, Chicago, Ill., of counsel.

Thomas A. Foran, U. S. Atty., Richard A. Makarski, Asst. U. S. Atty., Chicago, Ill., for plaintiff-appellee; John Peter Lulinski, Michael B. Nash, Asst. U. S. Attys., of counsel.

Before KILEY, CUMMINGS and KERNER, Circuit Judges.

CUMMINGS, Circuit Judge.

In August 1966, a six-count indictment was returned against Lee Roy Sohn, Milton W. Lewis, and Jerry Pace.¹ The first count charged defendants with a conspiracy to defraud the United States concerning its right to have the transaction of the business of the Veterans' Administration "conducted free from deceit, fraud, craft, trickery, dishonesty, unlawful impairment and obstruction," in violation of Section 371 of the Criminal Code (18 U.S.C. § 371). The indictment also contained five substantive counts alleging that various defendants had violated Section 289 of the Criminal Code (18 U.S.C. § 289).

After a jury trial, each defendant was found guilty with respect to all counts in which he was charged. General sentences of one year each were imposed on defendants Sohn and Lewis, together with fines. Defendant Pace was fined and sentenced to a probationary term of two years, with the first 30 days to be spent "in a jail-type institution." Pace has not appealed.

Sufficiency of the Indictment

Defendants do not attack the conspiracy count of the indictment, which charges them under 18 U.S.C. § 371, punishing conspiracy "to commit any offense against the United States, or to defraud the United States, or any agency thereof * * *."

The substantive counts charge violations of 18 U.S.C. § 289, which provides in pertinent part:

"Whoever knowingly and willfully makes, or presents any false, fictitious or fraudulent affidavit, declaration, certificate, voucher, endorsement, or paper or writing purporting to be such, concerning any claim for pension or payment thereof, or pertaining to any other matter within the jurisdiction of the Administrator of Veterans\' Affairs * * *."

Citing Sanchez v. United States, 134 F.2d 279, 282-283 (1st Cir. 1943), certiorari denied sub nom. Tapia v. United States, 319 U.S. 768, 63 S.Ct. 1325, 87 L.Ed. 1717, and other cases, defendants contend that this statute relates only to the subject of pension claims. The Sanchez case followed the Supreme Court's construction of an earlier version of this statute in United States v. Keitel, 211 U.S. 370, 395-397, 29 S.Ct. 123, 53 L.Ed. 230. In the light of the breadth of the language of the statute, the Keitel and Sanchez cases seem restrictive in limiting it to pension claims. But we do not need to construe Section 289 here, for defendants concede that the substantive counts of this indictment properly state an offense under Section 1001 of the Criminal Code (18 U.S.C. § 1001), which provides in pertinent part:

"Whoever, in any matter within the jurisdiction of any department or agency of the United States knowingly and willfully falsifies, conceals or covers up by any trick, scheme or device a material fact, or makes any false, fictitious or fraudulent statements or representations, or makes or uses any false writing or document knowing the same to contain any false, fictitious or fraudulent statement or entry, shall be fined * * * or imprisoned * * * or both."

Sufficiency of the Evidence

Count I of the indictment is the conspiracy count and charged that defendants Lewis, Sohn and Jerry Pace conspired with three non-defendant co-conspirators² to defraud the United States concerning its right to have the Veterans' Administration official business conducted free from deceit and the like. In 1961 Lewis and Sohn organized Milroy Realty Company, and, after becoming licensed Veterans' Administration brokers, they operated the company as a Veterans' Administration-approved realty company selling repossessed houses owned by the Veterans' Administration. Pace was a salesman for Milroy. To secure approval of sales of these homes to their customers, the defendants purportedly submitted false credit information to the Veterans' Administration concerning prospective purchasers upon VA Form No. 26-6705 for "Credit Statement and Offer of Prospective Purchaser." As part of the conspiracy, they allegedly obtained false credit reports from Hill's Reports, Inc. to substantiate the credit information contained on the VA forms. Eleven overt acts, including transactions with prospective customers similar to those alleged in the substantive counts, were alleged in furtherance of the conspiracy.

We conclude that there was ample testimony to prove the conspiracy charged in Count I. Much of the supporting evidence is summarized below under Counts II through IV. The falsified Veterans' Administration forms were always signed by Sohn or Lewis. Sohn himself placed false information on these statements. In the instance covered by overt act 5, prospective purchaser William Rodriguez gave correct credit information to both defendants and Lewis signed the falsified application that was filed with the Veterans' Administration. Similarly, the credit statement filed on behalf of Meddie Dampier, Jr., falsely represented that the applicant had no debts and overstated the value of some assets and listed nonexistent assets, all in contradiction to the information which the applicant had supplied to Sohn. Both defendants arranged with Hill's Reports for the speedy delivery of unchecked credit information. Through the falsified transactions, their creature, Milroy Realty Company, was enabled to receive commissions from the Veterans' Administration. We are satisfied that there was more than sufficient evidence to support the jury's verdict that these two defendants engaged in the conspiracy charged, even though some of the eleven overt acts might not have involved them sufficiently to constitute separate substantive offenses.³

Count II charged that in September 1962, defendants Lewis and Sohn presented to the Veterans' Administration a Credit Statement and Offer of Prospective Purchaser form signed by Theodore R. Gardner falsely representing that Gardner had no financial obligations. Like the remaining four Counts of the indictment, this was said to violate Section 289 of the Criminal Code, but defendants concede that these five Counts adequately charge a violation of Section 1001 of the Criminal Code.⁴ In support of Count II, the Government introduced in evidence Milroy Realty Company's invoice, signed by Sohn, to the Veterans' Administration for $825 commission on the sale of a repossessed house to Gardner, as well as a Hill's Report showing Gardner's net worth to be $6100. The Government also introduced the Credit Statement and Offer of Prospective Purchaser form signed by Gardner on September 6, 1962, and also signed by Sohn for the Milroy Realty Company on the same date. This credit statement contained the typed answer "None" as to Gardner's creditors.

Sohn testified that Lewis handled this transaction with Gardner. He said that Gardner came to the Milroy office because Lewis had sold Gardner's brother a home. Gardner testified that he told Sohn that he owed $200 to the Goldblatt's Department Store and $700 in car payments and $800 to the Goldenberg Furniture Company. He said that the VA form was being typed out as he spoke to Sohn on September 6 at the Milroy Realty Company's office. Gardner testified that Lewis was present in the office and was typing the form or asking him questions.

Viewing the evidence in the light most favorable to the Government (Glasser v. United States, 315 U.S. 60, 80, 62 S.Ct. 457, 86 L.Ed. 680), the Sohn and Gardner testimony, together with the documentary evidence, sufficiently involves both Lewis and Sohn in this transaction, so that the district court correctly denied their motion for judgment of acquittal.

Count III charged that defendant Sohn presented another fraudulent Credit Statement and Offer of Prospective Purchaser to the Veterans' Administration on January 18, 1963. The form stated that another prospective purchaser, William M. Swain, "had no obligations, had $500.00 in U. S. Savings Bonds, Stocks, and other securities, had $350.00 in cash on hand and on deposit, that he owned a 1952 Super Buick hardtop worth $300.00." Swain testified that he discussed the Veterans' Administration form with Sohn and told Sohn that he had no securities. Sohn told Swain that he would list $500 in securities in order to secure Veterans' Administration approval of the house purchase. Swain said that he told Sohn he only had $200 in cash on hand, but Sohn listed the amount as $350 on the form. Swain advised Sohn that he owned a 1957 Cadillac as well as the 1952 Buick, but Sohn said that he would not list the Cadillac because Veterans' Administration approval could not be obtained if both cars were listed. Swain also told Sohn that he had $200 worth of mechanic's tools, but Sohn listed them as $1500. He also listed Swain's furniture and appliances at $5,000 even though Swain testified that he did not have such assets. Swain also told Sohn of various debts, but Sohn listed them as "None." Interestingly enough, the Hill's credit report on Swain, submitted to the Veterans' Administration by Sohn, shows Swain's net worth as $7,650, the same amount as the various assets listed on the Veterans' Administration form prepared by Sohn and executed by him and Swain.

The jury was of course entitled to credit Swain's testimony, which amply supports the charge of Count III. However, Sohn contends that since Swain actually owned a 1952 Buick worth $300, the proof did not...