U.S. v. Cassano

• Court: U.S. Court of Appeals — Seventh Circuit
• Writing for the Court: Coffey
• Citation: U.S. v. Cassano, 372 F.3d 868 (7th Cir. 2004)
• Decision Date: 16 June 2004
• Docket Number: No. 01-4368.,No. 01-3857.,No. 01-3919.,01-3857.,01-3919.,01-4368.
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Angelo CASSANO, Norman "Randy" Williams, and Clarence Cross, Defendants-Appellants.

372 F.3d 868

UNITED STATES of America, Plaintiff-Appellee, v. Angelo CASSANO, Norman "Randy" Williams, and Clarence Cross, Defendants-Appellants.

No. 01-3857.

No. 01-3919.

No. 01-4368.

United States Court of Appeals, Seventh Circuit.

Argued January 7, 2003.

Decided June 16, 2004.

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Debra Riggs Bonamici (Argued), Office of the United States Attorney, Chicago, IL, for Plaintiff-Appellee in 01-3857, 01-3919 and 01-4368.

John A. Meyer (Argued), Chicago, IL, for Defendant-Appellant in 01-3857.

Stanley L. Hill (Argued), Hill & Associates, Chicago, IL, for Defendant-Appellant in 01-3919.

Patrick J. Cotter (Argued), Arnstein & Lehr, Chicago, IL, for Defendant-Appellant in 01-4368.

Before COFFEY, ROVNER, and EVANS, Circuit Judges.

COFFEY, Circuit Judge.

On March 21, 2000, a federal grand jury returned a twenty-four count superceding indictment against Clarence Cross, Norman "Randy" Williams, Angelo Cassano, and three other defendants, stemming from an alleged conspiracy to defraud Continental Casualty Company, a subsidiary of CNA Financial Corp. ("CNA"). The indictment sets forth, among other things, that from August 1995 to July 1997, the defendants caused approximately $3.8 million in misappropriated funds to be paid to three fictitious entities. Cross, Williams, and Cassano elected to stand trial, while their three co-defendants pled guilty. On May 10, 2001, following a three-week trial, the jury entered guilty verdicts against all three defendants on all counts. The defendants appeal their convictions. We affirm.

I. BACKGROUND

From 1986 to 1997, Clarence Cross was employed in the mail room of a large Chicago-based insurance company, CNA Financial Corporation. In 1995, Cross was the supervisor in charge of outgoing mail services at CNA. Cross' responsibilities included arranging for the outsourcing of various printing, sorting, and mailing functions, which CNA utilized to correspond with current and prospective clients. In conjunction with these duties, Cross was personally authorized to issue checks to vendors in amounts up to $1,000. Checks for amounts greater than $1,000 required the authorization of Cross' supervisor, Beverly Stephenson. Evidence submitted at trial establishes that between August 1995 and July 1997 (when Cross was discharged) CNA issued some 400 checks representing approximately $3.8 million to three fictitious entities: Fidelity Graphics; Eagle Mailing; and P & N Presort. At no time did any of these companies render any mail-related services to CNA. Once issued, Cross, with the help of Williams, Cassano, and his three other co-defendants, cashed the checks and retained the proceeds.

A. Cassano's Role in the Conspiracy

In the early 1980s, defendant Angelo Cassano became acquainted with a man by the name of William White. The two were casual friends; they played golf together ten to fifteen times per year and occasionally shared dinner and drinks. William White was also acquainted with Clarence Cross, who had enlisted White's assistance in the cashing of the fraudulent CNA checks.

As part of the scheme to defraud CNA, White set up a shell corporation known as Eagle Mailing. Eagle Mailing had no active business operations at all; the entity was only used as a vehicle for the issuance and eventual conversion of CNA checks into cash. In order to facilitate the scheme, White opened a bank account and a United States Post Office Box under the aliases William Kelly and William Reinhardt. White also obtained under the name Bill Thompson a pager to effectuate communications between himself and the other conspirators.

In September of 1995, after consulting with Cross, White began receiving checks from CNA made out to Eagle Mailing at his Arlington Heights, Illinois P.O. Box. After receiving the checks, White would either: endorse the checks to cash, endorse them to his assumed identity, William Reinhardt, or endorse them to Precision Data (another fictitious entity White had created). Then he would either take them to a bank or a currency exchange to have them cashed. All of the checks were made out for amounts less than $10,000, specifically to avoid Internal Revenue Service currency transaction reporting requirements under 31 C.F.R. § 103.22.

This process continued, with White cashing CNA checks once or twice per week, until February of 1996, when White found out he would be going back to prison. White had violated his probation on an earlier forgery and credit card fraud charges in DuPage County, Illinois with a DUI conviction, and he was sentenced to a three-year term in the Illinois Department of Corrections. This is when Cross sought Cassano's help in continuing the fraudulent cashing of CNA checks in his absence.

Approximately a month before he was to begin serving his sentence, White approached Cassano at the Bella Notte Restaurant in Morton Grove, Illinois, of which Cassano was the owner-operator. White testified that Cassano was not the first, but the third person, he had approached regarding the cashing of the checks. In their first meeting, White told Cassano that he had a friend, William Reinhardt (also White's assumed identity), who was going through a messy divorce and that, in order to conceal his assets, the friend was writing White checks to cash for him. White also assured Cassano that the checks were "good" (as in they would not bounce), but the pair did not discuss whether the arrangement would be legal. Cassano responded by telling White that he would have to ask around and see if he knew somebody who would help cash the checks.

At their next meeting, also at his restaurant, Cassano agreed to help and informed White that he had found a place to cash the checks, the Stone Park Currency Exchange. Subsequently, White spent approximately three months in prison, February to May of 1996. During that time, the record shows that Cassano cashed five checks totaling approximately $40,000. White testified that he neither asked for, nor was he offered, the proceeds from these checks. White also testified that although he filled out the date and signature on the checks cashed during the period he was in jail, someone else had filled in the amounts. Each check cashed during this period, as well as those that followed, were less than the $10,000 currency transaction reporting requirements.

Following White's release from prison, Cassano continued to cash CNA checks at the Stone Park Currency Exchange. Evidence presented at trial suggests White would page or call Cassano approximately once a week to let him know that there was a CNA check that needed to be cashed. Cassano would then meet White in the parking lot of the Stone Park Currency Exchange whereupon Cassano would go in and cash the check while White waited. The record suggests that Cassano was not initially compensated for his efforts. However, not long after White's release from jail, Cassano requested he be paid for cashing the checks. White initially demurred to Reinhardt (who was in reality White) but a week later began paying Cassano $100 to $500 per check.

The owner of the Stone Park Currency Exchange, Charles Salvatore, testified that beginning in early February of 1996, Cassano indeed brought in the first of some fifty-one second-party checks, totaling approximately $296,000, made out to Eagle Mailing and endorsed by William Reinhardt (a.k.a. William White). In addition, Salvatore and his employee, Yolanda Scott, testified that persons presenting second-party checks (checks made out to and endorsed by someone other than the person presenting them) were normally required to sign the checks as well. However, when asked to do so, Cassano had refused to sign, assuring Scott that the checks were "good" and that he had cleared it with (his friend) Salvatore. All of the checks were in fact "good" in that they cleared, and Cassano was allowed to repeat this procedure fifty-one times. Salvatore testified that on at least two occasions he conveyed his concern over the volume of money being paid out on Cassano's check and the possible motive for such transactions. On each occasion Cassano assured Salvatore that there was nothing to worry about and that the checks would be paid.

Salvatore and Scott also testified that Cassano was never required to complete a Currency Transaction Report. As mentioned above, Cassano and White took great care in making sure that all the checks cashed at the Stone Park Currency Exchange were in denominations less than $10,000. However, bank records show that on two separate occasions, October 17, 1996, and November 27, 1996, the Stone Park Currency Exchange cashed two CNA checks in one day that totaled more than $10,000, thereby triggering currency transaction reporting responsibilities under the Treasury Regulations.¹ Under the regulations, these transactions required the completion of a copy of IRS Form 4789, Currency Transaction Report, which was never filled out. At trial, two witnesses, White and Frank Amanti (one of the original co-defendants and a restaurant owner), testified that the $10,000 IRS reporting threshold was common knowledge in the restaurant business. Salvatore testified that he didn't think any of Cassano's transactions required the completion of a Currency Transaction Report.

In July of 1997, CNA Investigator Frank Erion and Agent John Teeling from the Federal Bureau of Investigation both paid visits to the Stone Park Currency Exchange. Following each visit Salvatore called Cassano, who continued to assure him that the checks were "good," that nothing was wrong, and that he was simply helping out his friend, Reinhardt, who was going through a nasty divorce.

On March 16, 2000, Cassano was charged, along with the co-defendants, in a twenty-four count superceding indictment with mail fraud, in violation of 18 U.S.C. §§ 1341, 1342, conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h), and structuring...