U.S. v. Bucuvalas

• Decision Date: 06 April 1992
• Docket Number: 90-2181,Nos. 90-2180,91-1018 and 91-2042,BEL-ART,s. 90-2180
• Citation: 970 F.2d 937
• Parties: UNITED STATES of America, Appellee, v. George M. BUCUVALAS, Defendant, Appellant. UNITED STATES of America, Appellee, v. Aristedes C. PORAVAS, Defendant, Appellant. UNITED STATES of America, Appellee, v. Arthur L. VENIOS, Defendant, Appellant. UNITED STATES of America, Appellee, v.REALTY, INC., Defendant, Appellant. . Heard
• Court: U.S. Court of Appeals — First Circuit

Page 937

970 F.2d 937

UNITED STATES of America, Appellee, v. George M. BUCUVALAS, Defendant, Appellant.

UNITED STATES of America, Appellee, v. Aristedes C. PORAVAS, Defendant, Appellant.

UNITED STATES of America, Appellee, v. Arthur L. VENIOS, Defendant, Appellant.

UNITED STATES of America, Appellee, v. BEL-ART REALTY, INC., Defendant, Appellant.

Nos. 90-2180, 90-2181, 91-1018 and 91-2042.

United States Court of Appeals First Circuit.

Heard April 6, 1992.

Decided July 22, 1992.

Rehearing and Suggestion for Rehearing En Banc Denied Aug. 27, 1992.

Morris M. Goldings with whom David R. Kerrigan, Mahoney, Hawkes & Goldings, Terry Philip Segal, Segal & Feinberg, and Kevin O'Dea, Boston, Mass., were on brief for appellants.

Carole S. Schwartz, Special Asst. U.S. Atty., with whom Wayne A. Budd, U.S. Atty., and Stephen P. Heymann, Asst. U.S. Atty., Boston, Mass., were on brief for appellee.

Before CYR, Circuit Judge, and COFFIN and CAMPBELL, Senior Circuit Judges.

CYR, Circuit Judge.

Defendants George M. Bucuvalas, Aristides C. Poravas, and Bel-Art Realty, Inc., appeal their convictions on two counts of engaging, and conspiring to engage, in a pattern of racketeering activity, 18 U.S.C. § 1962(c)-(d), multiple counts of mail fraud, 18 U.S.C. §§ 1341 and 2, and one count of conspiring to commit mail fraud, 18 U.S.C. § 371. Arthur L. Venios appeals his convictions for mail fraud and conspiracy to commit mail fraud. We affirm the convictions.

I BACKGROUND

From 1980 to 1987, Bucuvalas, Poravas, and Venios [hereinafter "defendants"] owned and operated a number of nightclubs, peep shows, movie theaters, and adult bookstores in Boston's Combat Zone (adult entertainment district), which were managed from offices owned by defendant Bel-Art Realty, Inc. [hereinafter "Bel-Art"] at 671 Washington Street. In order to be allowed to operate many of these establishments, it was necessary to obtain alcoholic beverage licenses, see Mass.Gen.L. ch. 138, §§ 1-78 (1991), and entertainment licenses, see Mass.Gen.L. ch. 140, §§ 181-185G, from municipal licensing boards to which the applicants were obligated to disclose the identity and background of all owners and managers of the premises to be licensed. ¹

In an attempt to conceal their prior criminal records, as well as their interests in the various enterprises, defendants paid "straw" persons and created sham corporations to "front" as record owners and operators and, through the use of the United States mails, utilized the names of these straw owners on license applications submitted to the municipal licensing boards. Bel-Art, which was controlled by one of defendants' coconspirators, aided the fraudulent scheme by executing several mock real estate "leases" to the straw owners. Unaware of these misrepresentations, the municipal boards issued licenses to the ostensibly independent and legitimate business establishments, and subsequently renewed their licenses on an annual basis. The scheme served a secondary purpose as well. When the municipality would threaten to revoke a license for violation of its conditions, or the Commonwealth of Massachusetts would attempt to collect back taxes, defendants merely arranged a sham sale of the establishment to a new straw owner. For good measure, between 1980 and 1986 Bucuvalas and his coconspirators bribed licensing board members and police officers to avoid accountability for infractions which might otherwise have resulted in license suspensions or revocations.

In February 1989, the defendants were indicted on two RICO counts and multiple counts of mail fraud ² and conspiracy to commit mail fraud. The RICO counts alleged nine predicate acts of mail fraud and six acts of bribery. The government sought criminal forfeiture of several parcels of Bel-Art's real property which allegedly "afforded the defendant ... a source of influence over the [RICO] Enterprise." See 18 U.S.C. § 1963(a)(2). Following a fourteen-day trial, the jury returned guilty verdicts on all counts against all defendants, as well as an in personam criminal forfeiture verdict against certain Bel-Art properties.

II DISCUSSION

A. Motion to Suppress

On September 25, 1987, FBI Special Agent Robert Jordan obtained a warrant to search Bel-Art's second-floor offices at 671 Washington Street, the reputed headquarters of the individual defendants' illegal enterprise. The search warrant authorized seizure of "records, documents, notes and physical objects evidencing [defendants'] ownership or control" of various businesses. Bel-Art moved to suppress the seized evidence on the grounds that the warrant was not supported by probable cause and did not describe with sufficient particularity the items to be seized. See U.S. Const. amend. IV. The district court denied the motion.

1. Probable Cause

Bel-Art contends that the affidavit accompanying the search warrant application did not establish probable cause to believe that documentary evidence of the alleged fraudulent scheme would be found at the search premises. Bel-Art characterizes most of the information in the affidavit as "stale," insofar as it related to events (the employment of straw owners and the bribery of board members and police officers by defendants or their coconspirators) which took place between 1960 and 1983, none less than four years prior to the search warrant application. ³

The probable cause determination is to be upheld if, "given all the circumstances set forth in the affidavit ..., including the 'veracity' and 'basis of knowledge' of persons supplying hearsay information, there is a fair probability that contraband or evidence of a crime will be found in a particular place." Illinois v. Gates, 462 U.S. 213, 238, 103 S.Ct. 2317, 2332, 76 L.Ed.2d 527 (1983) (emphasis added); see United States v. White, 766 F.2d 22, 25 (1st Cir.1985); Rahn, 511 F.2d at 293 (affidavit need not demonstrate "certainty" that items will be found). Moreover, the supporting affidavit must be viewed in a practical, "common sense" fashion, and we accord considerable deference to reasonable inferences the judicial officer may have drawn from the attested facts. See United States v. Falon, 959 F.2d 1143, 1147 (1st Cir.1992) (citing United States v. Ventresca, 380 U.S. 102, 108, 85 S.Ct. 741, 745, 13 L.Ed.2d 684 (1965)); United States v. Tabares, 951 F.2d 405, 408 (1st Cir.1991).

Staleness does not undermine the probable cause determination if the affidavit contains information that updates, substantiates, or corroborates the stale material. See Emery v. Holmes, 824 F.2d 143, 149 (1st Cir.1987); United States v. Ciampa, 793 F.2d 19, 24 (1st Cir.1986); United States v. Moscatiello, 771 F.2d 589, 597 (1st Cir.1985); United States v. Viegas, 639 F.2d 42 (1st Cir.), cert. denied, 451 U.S. 970, 101 S.Ct. 2046, 68 L.Ed.2d 348 (1981). Moreover, whether "averments in an affidavit are sufficiently timely to establish probable cause depends on the particular circumstances of the case." United States v. Hershenow, 680 F.2d 847, 853 (1st Cir.1982); see also United States v. Di Muro, 540 F.2d 503, 516 (1st Cir.1976), cert. denied, 429 U.S. 1038, 97 S.Ct. 733, 50 L.Ed.2d 749 (1977), and cert. denied, 429 U.S. 1038, 97 S.Ct. 733, 50 L.Ed.2d 749 (1977). Staleness is not measured merely on the basis of the maturity of the information but in relation to (1) the nature of the suspected criminal activity (discrete crime or "regenerating conspiracy"), (2) the habits of the suspected criminal ("nomadic" or "entrenched"), (3) the character of the items to be seized ("perishable" or "of enduring utility"), and (4) the nature and function of the premises to be searched ("mere criminal forum" or "secure operational base"). Moscatiello, 771 F.2d at 597 (quoting Andresen v. State, 24 Md.App. 128, 331 A.2d 78 (1975)), aff'd, 427 U.S. 463, 96 S.Ct. 2737, 49 L.Ed.2d 627 (1976); see also Rivera v. United States, 928 F.2d 592, 602 (2d Cir.1991); Rahn, 511 F.2d at 293.

The evidence detailed in Agent Jordan's supporting affidavit defines an "entrenched," "regenerating" criminal conspiracy which was sustained and perpetuated through an extensive web of fraudulent license applications, renewals, "straw" ownerships, and a pattern of bribes extending over a period of at least seven years. Although most events described in the affidavit occurred before 1983, a reliable informant reported that he saw one of the defendants' coconspirators bribe a Boston police officer as recently as August 1987, just one month before the search warrant. In addition, through licensing board records Agent Jordan verified that a person identified to an informant in 1980 as a straw owner was still designated a record owner on license renewal applications filed in behalf of one of the defendants' business establishments as late as 1986.

The affidavit presented enough circumstantial evidence from which a judicial officer reasonably could have inferred that documentary and physical evidence of the alleged ongoing conspiracy would be located in the second-floor Bel-Art offices at the time of the search. From 1980 through September 1987, the suite of offices at 671 Washington Street served as the apparent hub of directive activity for defendants' illegal enterprise and the central repository for important records relating to the ownership and operation of their various businesses. ⁴ It would be reasonable to infer that licensing information, documentary evidence, and important records relating to the ownership and operational control of an enterprise conducted at numerous, dispersed locations probably would be kept at some secure, centralized location, especially records of "enduring utility." The likelihood that Bel-Art's second-floor office suite at 671 Washington Street was the central repository for the business records of the criminal enterprise was corroborated on September 18, 1987, just days before the search warrant issued, when police officers conducted a license inspection at one...