Armstrong v. State
| Decision Date | 18 March 1991 |
| Docket Number | No. F-88-503,F-88-503 |
| Citation | 1991 OK CR 34,811 P.2d 593 |
| Parties | Tim ARMSTRONG, Appellant, v. STATE of Oklahoma, Appellee. |
| Court | United States State Court of Criminal Appeals of Oklahoma. Court of Criminal Appeals of Oklahoma |
TIM ARMSTRONG, Appellant, was tried by jury for the crime of Conspiracy to violate the Oklahoma Securities Act (one count), Selling an Unregistered Security (five counts), Fraud in Connection with the Offer and Sale of a Security (five counts), and Acting as an Unregistered Investment Advisor, Agent or Broker/dealer (two counts) in Case No. CRF-86-407 in the District Court of Pottawatomie County, before the Honorable Glen Dale Carter, District Judge. Appellant was sentenced to five (5) years imprisonment on the Conspiracy count and three years imprisonment on each of the remaining twelve (12) counts to be served consecutively. Appellant was fined five thousand dollars ($5,000) on each of the thirteen (13) counts. Judgment and Sentence is AFFIRMED.
David J. Batton, Norman, for appellant.
Robert H. Henry, Atty. Gen., Diane L. Slayton, Asst. Atty. Gen., Oklahoma City, for appellee.
Tim Armstrong, Appellant, was tried by jury for the crimes of Conspiracy to violate the Oklahoma Securities Act (21 O.S.1981, § 421) (one count), Selling an Unregistered Security (71 O.S.1981, § 301) (five counts), Fraud in Connection with the Offer and Sale of a Security (71 O.S.1981, § 301) (five counts), and Acting as an Unregistered Investment Advisor, Agent or Broker/dealer (71 O.S.1981, §§ 101, 201) (two counts) in Pottawatomie County District Court, Case No. CRF-86-407. The jury returned a verdict of guilty and in accord with the jury verdict the trial court imposed punishment of five (5) years imprisonment and a fine of five thousand dollars ($5,000.00) for Conspiracy, and three (3) years imprisonment and a fine of five thousand dollars ($5,000) for each of the remaining twelve counts. Each sentence is to be served consecutively. The appellant raises seven (7) propositions of error challenging the jury instructions, the admissibility of evidence, the constitutionality of the securities statutes, prosecutorial misconduct, and the unreasonableness of the sentence. We find no error warranting modification or reversal and AFFIRM.
Tim Armstrong, the appellant, worked as an investment adviser to Jane Kolbash and Anna Hawk. On his advice, the women invested or bought stock in several companies. Neither the appellant nor the securities he purported to sell were registered with the State as required by the Oklahoma Securities Act.
Jane Kolbash met the appellant through Ann Miller whom she hired as a hospice nurse to help care for her husband who was dying of lung cancer. Over the course of the illness the two women became friends. When her husband died, Mrs. Kolbash received payment of $75,000.00 on his life insurance policy and put the money in a certificate of deposit. Kolbash had never handled financial matters, and Miller suggested that she should be concerned about her financial future and talk with Bob Bowen. Miller and Bowen then recommended that Kolbash meet with the appellant as a financial advisor. Kolbash met with the appellant and over a period of time came to trust him and consider him a friend.
On the appellant's advice, Kolbash made four separate investments which he told her were absolutely without risk. She went with him and Bowen to American National Bank in Shawnee and pledged her CD against a loan of $10,000.00 for investment in Oklahoma Native Stone. Kolbash received the assignment of a mortgage and note, the appellant and Bowen received the proceeds of the loan. Kolbash understood she was to receive one-third of the profits from the investment, and the appellant also gave her a letter promising to pay her five percent (5%) of his share of the profits. Kolbash went to the bank a second time on the appellant's advice and pledged her CD against a loan in the amount of $15,000.00 for another investment. The appellant and Bowen received the proceeds; Kolbash received a contract for deed which was to generate a monthly income of $250.00.
Kolbash returned to the bank a third time, again on the appellant's advice, and pledged her CD against a loan in the amount of $17,000.00 to invest in a new long distance phone company, Phon-Et. Bowen and the appellant got the proceeds; Kolbash was to receive the accounts payable of the company, which the appellant told her were valued at $70,000.00. The appellant, Bowen and Kolbash also participated in a "three-way split" and each received $400.00 of the loan proceeds.
Kolbash's final investment was in the amount of $32,000.00 in Wetumka Materials, which the appellant told her produced perlite. The appellant promised her that she would have the amount of her investment back in six (6) months. No stock in Wetumka Materials was ever issued to Kolbash. None of these investments returned a profit, and eventually Kolbash lost her CD.
Anna Hawk met the appellant through similar circumstances. She was recently divorced when she talked with Miller about volunteering in a hospice program Miller was trying to start in Shawnee. Hawk informed Miller she had received a settlement through the divorce in the amount of $84,000.00; however, the case was on appeal and Hawk was not in a position to spend the money. Several months later, after the settlement was final Miller suggested to Hawk that she talk with Bowen. Bowen and Miller met with Hawk and suggested that she meet with the appellant. Over time he brought Hawk into his confidence. He told her she should think of her children's future. He assured her there was a lot of money to be made through private investments, and that her money would be completely secure.
Relying on this advice Hawk wrote the appellant eight separate checks for a total amount of $70,000.00 made payable to Bob Bowen for investment in a native building stone project. Hawk received a promissory note; an assignment of a 160-acre tract of land, which belonged to Bowen and which the appellant told her was valued at $240,000; a note and allegedly a five percent interest in Wetumka Materials. No stock was ever issued to Hawk. Hawk later investigated the land records at the county clerk's office and discovered Bowen owned only an undivided seventeen and a half (17 1/2) acres.
At trial the appellant made no objection to the jury instructions, but now claims that fifteen (15) of the instructions are improper. The appellant concedes his failure to object at trial has waived review by this court of all but fundamental error, that error which causes a miscarriage of justice. See Ashinsky v. State, 780 P.2d 201 (Okl.Cr.1989); Price v. State, 782 P.2d 143 (Okl.Cr.1989); Quilliams v. State, 779 P.2d 990 (Okl.Cr.1989). Appellant first objects to Instruction 15 in which the trial court summarized in detail the crimes with which the appellant was charged in accord with the Oklahoma Uniform Jury Instructions, OUJI-Cr. 902. He argues that the instruction left nothing for the jury to decide. As the first sentence states that the following facts are alleged, and the last sentence of this instruction plainly states the defendant has entered a plea of not guilty to the charges, we are not persuaded by the appellant's argument.
Appellant also objects to Instruction 36 which informed the jury that the defendant bears the burden of establishing that the transactions are exempt from the requirements of the Oklahoma Securities Act. For reasons which we fully discuss below in the sixth proposition of error, we find this instruction to be a correct statement of the law. Appellant claims Instructions 22 to 32, and 34 which define a "security", "aiding and abetting", "agent, dealer and investment advisor", "material omission" and "willfully" are misstatements of the law. They are not. Appellant really is objecting to the wide cast of the Securities Act net, a futile argument.
Appellant directs our attention to a supplemental transcript to argue an instruction on circumstantial evidence was warranted. We ruled on April 5, 1990, that the supplemental transcript is not part of the record before us. Therefore we will not review the supplemental transcript for fundamental error. As his final argument regarding instructions the appellant states that statements of his "co-defendant" were admitted and no limiting instruction was given. There is no fundamental error here, for the appellant was tried alone and had no co-defendant.
In his second proposition of error the appellant argues that the trial court has the duty to instruct on defenses raised by the evidence and that the court should have instructed the jury that the defendant was an "issuer" and exempt from the registration requirements of the Oklahoma Securities Act. The appellant cites no authority to support his claim he was an issuer and we find the evidence does not support this position.
Appellant also objects to the fact that the trial judge did not instruct the jury regarding the many exemptions to the definition of broker/dealer, agent and investment advisor set forth in 71 O.S.1981, § 2. None of the exemptions which the appellant urges should have been instructed were supported by the evidence. The trial court instructed the jury on the only defense which was supported by the evidence. Instruction 35 explained:
... (U)nder Oklahoma law a transaction is exempt from registration requirements if it is: any transaction in a bond or other evidence of indebtedness secured by a real or chattel mortgage or deed of trust, or by an agreement for the sale of real estate or chattels, if the entire mortgage, deed of trust, or agreement, together with all the bonds or other evidences of indebtedness secured thereby, is offered and sold as a unit.
Appellant next challenges admission of hearsay...
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