U.S. v. Toliver

• Decision Date: 02 September 1976
• Docket Number: Nos. 1143-45,D,s. 1143-45
• Citation: 541 F.2d 958
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Louis TOLIVER et al., Defendants-Appellants. ockets 76-1130, 76-1136, 76-1202.
• Court: U.S. Court of Appeals — Second Circuit

Page 958

541 F.2d 958

UNITED STATES of America, Plaintiff-Appellee, v. Louis TOLIVER et al., Defendants-Appellants.

Nos. 1143-45, Dockets 76-1130, 76-1136, 76-1202.

United States Court of Appeals Second Circuit.

Argued June 17, 1976.

Decided Sept. 2, 1976.

DiPasquale, Pack, Hausbeck, Ball & Greenman, Buffalo, N. Y. (Herbert L. Greenman, Buffalo, N. Y., of counsel), for appellant Toliver.

Stephen R. Lamantia, Buffalo, N. Y., for appellant Askew.

David Gerald Jay, Buffalo, N. Y., for appellant Cook.

Richard J. Arcara, U. S. Atty., W. D. N. Y., Buffalo, N. Y. (Roger P. Williams, Asst. U. S. Atty., Buffalo, N. Y., of counsel), for appellee.

Before MANSFIELD, OAKES and GURFEIN, Circuit Judges.

MANSFIELD, Circuit Judge:

Fraudulent schemes usually reveal a level of ingenuity on the part of the swindlers which would, if devoted to honest ends, gain them both profits and community respect. These cases are no exception. They reveal a clever plan to defraud the New York State Unemployment Insurance Fund by the filing of fictitious claims for unemployment compensation. Though the scheme operated successfully for a period of some two years, its architects were ultimately apprehended, and after a ten-day jury trial in the District Court for the Western District of New York, before John T. Curtin, Judge, appellants were convicted of various counts charging conspiracies to use the mails to defraud in violation of 18 U.S.C. § 371, and others charging substantive mail frauds in violation of 18 U.S.C. §§ 1341, 1342. ¹ The principle questions raised by them here are whether proof in support of each of the conspiracy counts showed multiple conspiracies rather than the single conspiracy charged, and whether the continuation of the trial while appellant Askew was absent due to illness violated her rights to confront the witnesses against her. We find that neither these nor the other points raised require reversal, and accordingly affirm the judgments of conviction.

To understand the tangled web of fraud a brief description of the workings of the state's unemployment insurance system is essential. In order to obtain unemployment benefits a claimant must first go to his local state unemployment office and fill out a form entitled "original claim for benefits" (Form LO 330). The claimant must list on this form his basic personal data, his places of employment during the past 52 weeks, and the reason why he is currently out of a job. Using the data thus provided, the unemployment office mails an "employment verification and wage data form" (Form LO 12.11) to the claimant's former employer. On this form, the employer lists the hours worked by, and wages paid to, the claimant during the previous 52 weeks, and mails the form LO 12.11 back to the local unemployment office.

On the basis of the wage data provided by the employer, the unemployment office calculates the benefits for which the claimant is eligible. This information is then entered on his form LO 330. When the claimant returns for a previously-set appointment at the unemployment office, he then verifies that he has not worked during the previous week and, assuming that he has not, signs a pay order form (LO 406). This form is then sent from the local office to the unemployment system's central office in Albany. If a computer analysis of the pay order indicates that the claimant was eligible for benefits for the week, a check is drawn and mailed to the claimant's home address. Each week, to be able to receive his weekly check, the claimant must return to the unemployment office, and again verify his unemployment and sign a pay order form.

While the details of the fraudulent scheme used by appellants varied somewhat at the different locations at which they operated over the 1970-72 period, the essential elements were always the same. One conspirator would go to the local unemployment office and fill out a Form LO 330, using either his own or an assumed name. He or she would claim to have been employed either at a defunct business formerly operated by appellant Cook, or more frequently at an actual business not involved in the scheme. Though the name of an actual business was frequently used, its correct address was not given; the bogus claimant would instead give as the firm's mailing address the home address of a conspirator. The unemployment office did not verify the purported employer's address; instead, it routinely mailed the form LO 12.11 to the home of the conspirator. When the Form 12.11 arrived, Cook would confirm the employment of the claimant and give bogus details as to the wages purportedly paid. He would then sign the form in the name of the actual owner of the business, and give the employer's unemployment insurance identification number, which had previously been obtained through visiting the offices of the employer, who was required by law to post the number. The Form LO 12.11 would then be mailed back to the office, which would calculate the benefits due and, after the false claimant had returned to verify his continued unemployment and sign a pay order form (LO 406), checks would be drawn, mailed to the claimant's address, and usually cashed with the aid of false identification papers.

The government's case consisted primarily of extensive documentary proof. It introduced into evidence numerous fraudulent Form LO 330s, and LO 12.11s, as well as the cancelled checks issued as a result of those forms. An expert witness testified that the handwriting on various of the forms and checks was that of the appellants and of other participants in the scheme. The owners of the legitimate businesses whose names were used in the scheme testified that they had never employed any of the claimants, had never operated their businesses at the addresses given for them by the claimants, and had not signed the Form LO 12.11s bearing their purported signatures. Further evidence indicated that the business formerly operated by Cook was defunct at the time when various claimants alleged they had been employed there, and George Raspberry, a co-defendant who had pleaded guilty at the outset of trial, testified as to his involvement with Cook in the scheme. As corroboratory evidence the government introduced photographs taken by cameras at check-cashing services, showing various defendants and the unemployment checks they were in the process of cashing.

Discussion

We first turn to the claim by Toliver and Askew that their convictions on the conspiracy counts should be reversed because the government proved multiple rather than single conspiracies. See, e. g. Kotteakos v U. S., 328 U.S. 750, 66 S.Ct. 1239, 90 L.Ed. 1557 (1946); U. S. v. Bertolotti, 529 F.2d 149 (2d Cir. 1975). The indictment contains several conspiracy counts (e. g., Counts I, XIII, XXX, XXIV, XXXVI, LI, LVIII, LXIV), each charging a different combination of defendants with conspiracy in violation of 18 U.S.C. § 371 to violate the mail fraud laws, 18 U.S.C. §§ 1341, 1342. Although the names of certain defendants may appear in more than one conspiracy count, the combination of defendants in each conspiracy count differs from that in the others. The only counts which included all three of the present appellants and thus made their joinder together in the indictment proper under Fed.R.Crim.P. 8(b) were the conspiracy and mail fraud counts involving Cook's Auto Care. (See, e. g., Counts XIII, XIV, XXII, XXV, XXIX).

Toliver and Askew argue that the evidence adduced regarding Cook's Auto Care, rather than indicating a single conspiracy, shows two separate conspiracies one between Cook and Toliver, and the other between Cook and Askew to file the Cook's Auto Care claims. Finally, they conclude that this variance between pleading and proof substantially prejudiced them. The government conceded at trial that it had no evidence directly tying Toliver and Askew together in the Cook's Auto Care operation. This concession is somewhat surprising in view of the fact that Askew appears to have second-endorsed a check issued to Cook as a purported former employee of Cook's Auto Care; Cook used Toliver's address on this claim. For the most part, however, the evidence adduced in regard to Cook's Auto Care does show only that Toliver and Askew each separately filed claims falsely representing that he or she had worked for Cook's Auto Care, which Cook then certified as their purported employer, and that Cook also filed claims of his own falsely stating that he had worked for Cook's Auto Care.

We find it unnecessary to decide whether this proof, in the context of the overall, highly organized system for filing false claims which was proven at trial, was sufficient to indicate that the government proved a single conspiracy between all three appellants in regard to Cook's Auto Care, as distinguished from two separate conspiracies. As we recently noted in United States v. Miley, 513 F.2d 1191, 1207 (2d Cir. 1975), cert. denied, 423 U.S. 842, 96 S.Ct. 74, 46 L.Ed.2d 62.

"Where the indictment charges one conspiracy, but the proof shows more than one, a variance is not necessarily fatal. 'The true inquiry . . . is not whether there has been a variance in proof, but whether there has been such a variance as to "affect the substantial rights" of the accused.' Berger v. United States, 295 U.S. 78, 82, 55 S.Ct. 629, 630, 79 L.Ed. 1314 (1935)."

Upon this record neither Toliver nor Askew was prejudiced by a variance, if one existed. Indeed, neither even sought to bring the point to the attention of the district judge by moving for a severance below. Cf. United States v. Payden, 536 F.2d 541, 542-543 (2d Cir. 1976). See also United States v. Miley, supra, 513 F.2d at 1209-10. None of the forms of prejudice which may flow from the joint trial of members of two different conspiracies are disclosed. Here, as in Miley, no hearsay statements by a member of one conspiracy incriminating a member of another were admitted into evidence on...