The opinion of the court was delivered by: MOTLEY
Defendant was charged in a twelve count indictment with violating 49 U.S.C. § 121
and 18 U.S.C. § 2.
The indictment charged that defendant Aadal and Monarch Trading Company, Inc. "unlawfully, wilfully and knowingly, and with intent to defraud, did issue and aid in the issuing and procuring the issue of, and did negotiate and transfer for value, bills of lading", described in each of the twelve counts, "purporting to represent goods received for shipment from Baltimore, Maryland to Karachi, Pakistan, which bills of lading, as the defendant then knew, did contain false statements as to the receipt of goods and other matters, to wit, false statements as to the weight, quantity and description of goods purportedly covered by the said bills of lading."
Defendant waived trial by jury.
Upon the eleven day trial, the evidence adduced by the government established the following material facts:
1. Defendant Aadal was the president of Monarch Trading Company, Inc. and president of American Asia Lines, Inc., both located in New York City. Monarch was a shipping company engaged in the export-import business. American Asia Lines was the agent for four affiliated steamship companies each of which owned one vessel, i.e., the SS. Eldorado, Yukon, Bonanza and Ponderosa. American Asia Lines also chartered a vessel known as the SS. Cathy.
2. In February of 1964, Monarch received orders for the shipment of steel sheets and billets from purchasers in Pakistan. Payment for these shipments was provided for by irrevocable letters of credit established by the purchasers through the National Bank of Pakistan in favor of Monarch. These letters of credit were drawn on Manufacturers-Hanover Trust Company in the City of New York. In each instance, the letters of credit required as a condition of payment "On Board" bills of lading.
3. Twelve such "On Board" bills of lading were prepared and issued for nonexistent or short shipments between April 21, 1964 and May 29, 1964 by American Asia Lines. Monarch negotiated the false bills of lading issued by American Asia Lines in connection with the letters of credit.
4. This fraudulent negotiation resulted in Monarch receiving for itself or its assignee approximately $800,000 from Manufacturers-Hanover for which no steel was ever shipped to the purchasers in Pakistan. When the bills of lading were negotiated, there was either no steel placed on board the indicated vessel, which was one of those named above; or there was steel placed on board of considerably less weight than required by the particular purchase order. Some of the unshipped steel was subsequently shipped, but the resulting loss to the purchasers in Pakistan was $800,000.
5. More specifically, with respect to 7 bills of lading negotiated by Monarch no steel was ever shipped on board any of the ships operated by American Asia Lines. In the case of 4 of the bills of lading, steel was placed on board but was considerably less than the amount ordered. In one instance, the ordered steel was shipped 22 days later.
6. Defendant not only was the president of Monarch Trading Company, Inc., and American Asia Lines, Inc., but he controlled the operations of both companies; both companies occupied adjoining offices in the same building; and the employees in both companies worked under the direction of defendant as president.
7. The twelve false bills of lading were either prepared by defendant or under his direction and they were negotiated with the defendant's knowledge of their falsity and pursuant to his direction with the intent to defraud. Specifically, the evidence showed that defendant actually worked on the orders for the steel, consulted with an employee regarding the booking of freight on various vessels, prepared some of the bills of lading himself, directed the placing of the "On Board" stamp ...