United States v. Cohen

Decision Date15 January 1945
Docket Number310,No. 309,337.,326,309
PartiesUNITED STATES v. COHEN et al.
CourtU.S. Court of Appeals — Second Circuit

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Walter Brower, of New York City, for Joseph Cohen.

P. Wolf Winer, of New York City, for Mandel Raffe.

Jac M. Wolff, of New York City, for Bertram M. Wachtel.

Samuel W. Altman, of New York City, for Joel Rosenberg.

Philip Handelman, of New York City, for N. E. Rogoff.

James B. M. McNally, U.S. Atty., of New York City (John F. X. McGohey, Peter J. Donoghue, Saul S. Sharison, and David Hartfield, Jr., Asst. U. S. Attys., all of New York City, of counsel), for appellee.

Before L. HAND, SWAN, and CHASE, Circuit Judges.

Writ of Certiorari Denied January 15, 1945. See 65 S.Ct. 553.

L. HAND, Circuit Judge.

Five of the twenty-seven defendants, who were brought to trial in this case, appeal. We shall first consider the appeals of three — Cohen, Wachtel and Raffe — since they, perhaps with Fogelson, were the most important actors in a long series of frauds, in some of which all four were confederated, in others of which they apparently operated in two separate groups, as will appear. Rogoff and Rosenberg had subordinate parts in these transactions, and we shall reserve consideration of their appeals until the end. Seventy-five persons were indicted; twenty-eight pleaded guilty before trial; as to nineteen the trial was severed; the indictment was dismissed as to one before trial. Of the above mentioned twenty-seven originally brought to trial on August 5, 1941; verdicts were rendered as to thirteen on March 7 and 8, 1942; thirteen had meanwhile pleaded guilty, and the case had been dismissed by consent as to one. The jury found eleven guilty of the thirteen who remained on March 7 and 8, 1942 and acquitted two; of the eleven convicted six have not appealed, and have presumably already served their sentences, since in no case were these as long as the time that has now elapsed since the verdict. The trial took seven months and the record occupies nearly 12,000 pages. (The stenographer's minutes number almost 16,000 pages.) The indictment was in thirty counts; twenty-nine, for using the mails to defraud — § 338, Title 18 U.S.C.A. — and the last, for conspiracy to commit that crime. The first twenty-nine counts alleged a single "scheme," and differed only in the "count letters"; i.e., letters mailed, one in each case in furtherance of the "scheme." The conspiracy count alleged twenty-nine "overt acts," of which the first four occurred more than three years before the indictment was found, September 30, 1938. The "scheme" and the conspiracy were, in general, to sell to individuals — called "victims" — interests of various sorts in oil bearing lands, and shares of stock in a number of corporations: sometimes oil companies, sometimes not; sometimes companies organized by the defendants, sometimes not. All the "count letters" were alleged to have been posted in the Southern District of New York after September 30, 1935.

We will premise what we say by dealing at once with an error which pervades the arguments of all the accused. They uniformly assume that an appellate court, before affirming a verdict in a criminal case, will demand that the evidence shall be more cogent and persuasive than when reviewing a civil verdict: i.e. that, since the jury must be satisfied of the accused's guilt beyond a reasonable doubt, an appellate court will more straitly scrutinize the evidence necessary to sustain the verdict. There is indeed authority for that position, but it is not the law as we understand it; on the contrary, the certainty required in a criminal case is that of the jury alone, and evidence sufficient to support a civil verdict will support a criminal one. We shall add nothing to our discussion in Feinberg v. United States, 2 Cir., 140 F.2d 592, 594. See also United States v. Andolschek, 2 Cir., 142 F.2d 503, 504.

The evidence was sufficient to justify the jury in finding that the facts stated in the following narrative were true. In 1929 Raffe was doing business in Boston as a broker; Fogelson joined him as a salesman in the following year, and by 1933 had become important enough to share the profits with him in a land venture in Texas. In that year Cohen and Wachtel were employed in New York in a brokerage house, called Percy Winter & Company; Fogelson left Raffe in 1932 and for a month or so took employment in that company, after which he returned to Boston. In 1933 Raffe was sounding out prospective customers under the assumed name, National Publishers Service, by sending letters to persons whose names he took from a list furnished him by others. From the character of their responses he determined whom to have his salesmen approach with circulars and by interviews. In 1934 he formed a connection with a man named Pike under the name Joel Pike & Company, and they, together with one Goldie and others continued to do the same kind of business. There was ample evidence to justify a finding that in his business with Fogelson, Pike, Goldie and the others, Raffe was guilty of continuous and manifold frauds in the selling of interests in oil hands and shares of stock. These frauds were of various kinds; sometimes by misrepresenting the property in direct sales to the customers; sometimes by wheedling them out of good property or securities. The victims were generally persons — very frequently women — unused to affairs, and ignorant of the kind of property transferred, and the misrepresentations were of the sort with which courts have become familiar; ordinarily, grossly exaggerated, or baseless, estimates of the prospects of the lands or shares as income producers. Frequently, the path would be paved by visits or letters, falsely purporting to be of persons interested in adjacent properties, whose development was said to be dependent upon the acquisition of the property sold to the victim. At other times the salesman would either call up, or be called up by, some fictitious corporation — "Statistical Department" or the like — to give color to the talk.

Fogelson had come back to Boston before Joel Pike & Company had been organized, and was doing business on his own account under another name. His relations with Raffe had not been severed however, and Raffe told him to give to Pike all "potential" oil lands for which Pike asked. While Cohen and Wachtel were working with Percy Winter & Company they had the names of a number of "prospects" in Massachusetts, and, when Fogelson was on a visit to New York in 1934 they gave him some of these names, and he supplied them to Pike's company. In that company was a man named Gaines to whom Wachtel supplied still other names directly; and when Wachtel went to Boston, Pike paid him by cheque for this service. As early as 1933 a man named Mussman, the chief witness for the prosecution, began to work for Raffe. He was, on his own admission, an altogether abandoned character, frank to confess a long career of cheating and fraud; seeking to secure lenity by his testimony, and hostile to the accused. The appellants appear to predicate much of their defence upon the unreliability of his testimony, although the case for the prosecution by no means depended wholly upon him. It is scarcely necessary to repeat the conventional answer: the testimony, even of an uncorroborated accomplice who turns state's evidence, will support a conviction. Again and again it has satisfied juries of the guilt of those on whom such wretches turn; from time immemorial it has been the reliance of prosecutors; and juries have probably shown their good sense in accepting it. Mussman was no different from the ordinary type, except possibly in the venom he showed against his former confederates. Raffe set him to work upon a number of "prospects," and the two agreed upon the frauds which should be perpetrated upon them; often in order to throw them off the scent the transactions were completed through fictitious names.

Meanwhile Cohen and Wachtel continued business in New York, either as employees or members of Percy Winter & Company; and we will assume for argument that in its earlier stages the business was not fraudulent, although in the light of later events that seems improbable. At any rate late in 1934 Fogelson saw them, and they agreed that they would turn over promising — "qualified" — New England names to him in return for which he was to give them a third of any profits he might make on the transactions. Beginning then, and going through 1935, and perhaps longer, this became a practice between them and went into a number of fraudulent transactions. Gaines of Pike & Company introduced Mussman to Wachtel in New York late in 1934, and Wachtel, later, by a telephone message to Raffe's office, brought Mussman to New York, where he introduced him to his partner, Cohen. By the spring of 1935 Mussman was working for, or in cooperation with, both "partners"; and for some part at least of that time, he was also working for, or in cooperation with Raffe. The prosecution put in evidence of more than 200 separate fraudulent transactions with customers; each of these was a "scheme," each was a "conspiracy," and while we do not understand that any of the accused concedes his guilt in any one, it is unnecessary to go into the evidence in detail, so far as concerns the subordinates who actually made the sales. There can be no doubt about their guilt.

The theory of the prosecution was that Raffe, Cohen and Wachtel were all confederates with these subordinates in a single "scheme," in the execution of which each of the twenty-nine transactions in furtherance of which a "count letter" was mailed, was a step. As we shall show later, Raffe was implicated in the transaction in furtherance of which the "count letter" in Count 2 was mailed; Cohen was similarly implicated in Counts 1, 4, 22, 23 and...

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