U.S. v. Howard, s. 83-1456

• Citation: 751 F.2d 336
• Decision Date: 27 December 1984
• Docket Number: 83-1461 and 83-1506,Nos. 83-1456,s. 83-1456
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Virgil HOWARD, Alan Kluger, and Albert Schrager, Defendants-Appellants.
• Court: United States Courts of Appeals. United States Court of Appeals (10th Circuit)

Page 336

751 F.2d 336

UNITED STATES of America, Plaintiff-Appellee, v. Virgil HOWARD, Alan Kluger, and Albert Schrager,

Defendants-Appellants.

Nos. 83-1456, 83-1461 and 83-1506.

United States Court of Appeals, Tenth Circuit.

Dec. 27, 1984.

Vicki Mandell-King, Asst. Federal Public Defender, Denver, Colo. (Michael G. Katz, Federal Public Defender, Denver, Colo., with her on brief), for defendant-appellant Virgil Howard.

Patrick J. Burke of Renner, Rodman & Burke, Denver, Colo., for defendant-appellant Alan Kluger.

J. Terry Wiggins, Denver, Colo., for defendant-appellant Albert Schrager.

Charles H. Torres, Asst. U.S. Atty., Dist. of Colo., Denver, Colo. (Robert N. Miller, U.S. Atty., Denver, Colo., with him on brief), for plaintiff-appellee.

Before McKAY, McWILLIAMS and LOGAN, Circuit Judges.

McKAY, Circuit Judge.

Messrs. Schrager, Howard, and Kluger were indicted along with Messrs. D'Huyssee and Darden under a five-count indictment alleging that they participated in a scheme and artifice to defraud and obtained money or property by means of false and fraudulent pretenses, representations and promises in violation of 18 U.S.C. Secs. 2, 1343, and 2314.

The indictment alleged that the defendants made a series of misrepresentations to their American clients, inducing them to pay money in exchange for defendants' promises to help them obtain financing for their various business deals. Specifically, the indictment alleged that the defendants made, among others, the following misrepresentations: that Mr. Howard was a money broker associated with Mr. Schrager who could arrange immediate financing through European sources; that Mr. Schrager was involved with the United Nations, was Director of the World Health Organization, and was a person of international renown; that Messrs. Schrager and Kluger were representatives of the University of Antigua, an institute of international medical education; and that Mr. Schrager had presented many loan proposals to European banks and had established excellent relationships with those banks. The indictment also alleged that Mr. Darden represented himself as an attorney for the Figebel Bank in Belgium.

The indictment alleged, among others, the following specific facts: that the defendants induced a client to travel in interstate commerce from Kansas to Colorado with money or property having a value of $5,000 or more; that defendants transmitted or caused to be transmitted wire transfers of $25,000 and $38,000 from banks in Colorado to a bank in New York; and that defendants on two occasions made interstate or international telephone calls in the furtherance of the scheme or artifice to defraud.

The three American defendants--Messrs. Howard, Kluger and Schrager--were tried and convicted on four of the five counts. After their trial but before their appeal Mr. D'Huysee was tried, his case having been severed due to problems with his extradition. Mr. Darden was granted immunity for agreeing to testify in Mr. D'Huysee's trial.

The testimony of Mr. Darden was presented as evidence in Mr. D'Huysee's trial. Mr. Darden's testimony showed that Mr. D'Huysee had no knowledge of the fraudulent representations that had taken place in America and no knowledge of the inducements which had been made to get the clients to Europe. Accordingly, the trial court ruled that a fatal variance existed between the indictment and the evidence produced at Mr. D'Huysee's trial and that, although Mr. D'Huysee had been engaged in a scheme to defraud the clients after they arrived in Europe, his scheme was independent of the one devised and operated by defendants Schrager, Howard and Kluger to defraud the clients on this side of the Atlantic.

On appeal the defendants seek to use the evidence adduced at Mr. D'Huysee's trial and the court's ruling in that case to support a claim of fatal variance between the indictment and the evidence produced at their trial. In essence they argue that while only one scheme to defraud was alleged in the indictment, two were proved. Their attempted reliance on the evidence presented in Mr. D'Huysee's later trial is misplaced. The question of fatal variance must be judged on the record as it stood at the end of the evidence in the defendants' own trial. An examination of that evidence, even as it is characterized in the briefs on appeal, makes clear that the government's proof coincided with the scheme alleged. Since there was no variance, we need not reach the question of whether the issue must be preserved by proper objection in order to be raised on appeal.

In addition to the variance problem, defendants Kluger and Howard claim that the acquittal of Mr. D'Huysee was an inconsistent acquittal of a codefendant that requires reversal of their own convictions. Their argument must fail for two reasons. First, there is no inconsistency between Mr. D'Huysee's acquittal and the convictions of the three American defendants. Mr. D'Huysee's acquittal was based on the government's...