The opinion of the court was delivered by: COOPER
The indictment herein is under attack; defendant Culoso calls for its dismissal on the ground that it is outlawed by the statute of limitations and/or venue is totally absent. If this is not to be, defendant demands a transfer of venue and a bill of particulars addressed to two counts (3 and 4). We find impressive merit in the totality of the Government's opposition (set out in its brief) and accordingly we are constrained to and do deny the instant motion in all respects.
We emphasize certain portions thereof decisive of the application now before us. In this count (one), this defendant is charged with unlawfully agreeing with others to defraud the United States of its lawful right to have the Small Business Administration (S.B.A.) administer the provisions of the Small Business Act "fairly and impartially without influence, unlawful inducement, false representations, favor or fraud."
The objectives and means of the conspiracy are clearly set out in the indictment: On or about March 23, 1973, defendant agreed with certain principals of Jordan Metal Products Corporation ("Jordan") that in return for a sum of money, he would procure for Jordan a loan from a bank (whose deposits were insured by the Federal Deposit Insurance Corporation) ninety percent (90%) of which would be guaranteed by the S.B.A.; that Jordan, upon advice of defendant, sought a $ 350,000 S.B.A. guaranteed loan and "as required by CULOSO said principals did agree to make and did make a $ 35,000 payment to CULOSO without disclosing the payment to the S.B.A." or the bank.
Further, that following defendant's advice, Jordan temporarily increased its capitalization "to induce the approval of their loan application using approximately $ 30,000 of their personal funds with assurances from CULOSO that after the loan was approved those principals (of Jordan) could siphon this money back out of Jordan Metal."
And so, on the advice and direction of defendant, Jordan issued checks "made out to businesses to which Jordan Metals owed no money, principals of Jordan Metals made disguised and unreported payments totaling $ 35,000" to this defendant, and by the same method those principals made such withdrawals from their company "of the money temporarily used to capitalize the company during the pendency of the loan applications" and "drafted false invoices to support the fraudulent checks."
Significant among the overt acts recited in the conspiracy count, it is alleged that defendant advised the President of Jordan that it would be a " "defalcation' to fail to report the finder's fee on the S.B.A. application and that if any questions about the defendant's role in the transaction were asked the defendant should be identified as solely an insurance broker."
The second count in essence charges that defendant aided the application for an S.B.A. guaranteed loan without disclosing either the monies paid or to be paid the defendant or the $ 30,000 capitalization added to Jordan as hereinabove mentioned; also that defendant advised the issuance of checks by Jordan to payees not owed money by it (see above) which checks were used "to generate cash to pay the defendant CULOSO'S fee and to secretly refund the above-described capitalization."
Count three charges defendant corruptly endeavored to obstruct the proper administration of law under which an S.B.A. proceeding was conducted by "advising a principal of Jordan Metals to misrepresent the full extent of the defendant CULOSO'S services in obtaining the loan and to prepare false and fraudulent checks and invoices some of which were presented to an S.B.A. employee in an interview at Jordan Metals' offices on July 31, 1975."
We come now to count four which charges that defendant by various means endeavored "to obstruct, delay and prevent the communication to a criminal investigator of information relating to a violation of criminal statutes . . . by . . . advising a principal of Jordan Metals to misrepresent the full extent of the defendant CULOSO'S services in obtaining the loan and to prepare false and fraudulent checks and invoices some of which were presented to an F.B.I. agent pursuant to a subpoena served on Jordan Metals on January 16, 1976."
The statute of limitations
Defendant places a great deal of emphasis on his contention that the prosecution of this indictment in its entirety is time-barred under 18 U.S.C. § 3282 because the loan application which contains the initial false statements was submitted earlier than five years before the filing of the indictment on August 10, 1978. This position must fall because the conspiracy count alleges some overt acts in furtherance of the objectives of the conspiracy which occurred after the filing of the indictment. The statute begins to run, in criminal conspiracy charges, from the date of the last overt act. United States v. Brasco, 516 F.2d 816, 818 (2d Cir. 1975); United States v. Albanese, 123 F. Supp. 732, 734 (S.D.N.Y.1954), Aff'd 224 F.2d 879 (2d Cir.), Cert. denied 350 U.S. 845, 76 S. Ct. 87, 100 L. Ed. 753 (1955); United States v. Flynn, 103 F. Supp. 925, 927 (S.D.N.Y.1951), Aff'd, 216 F.2d 354 (2d Cir. 1954).
Accordingly, if the pursuit of the objectives of the same conspiracy embraced some overt acts (as alleged) committed within the last five years, the conspiracy count in its entirety stands, for it is not time-barred.
Defendant urges upon us as decisive of his contention the rule in Grunewald v. United States, 353 U.S. 391, 77 S. Ct. 963, 1 L. Ed. 2d 931 (1956).
He argues that the conspiracy ended in April, 1973 when the loan application (with vital information bearing on its merits omitted) was filed. Repeated throughout the indictment is the assertion that a crucial objective of the conspiracy was the defendant's status as a "finder" and this in turn was concealed from the agency of the Government. While the concealment was initiated when the loan application was filed, defendant is charged with perpetuating the same concealment long after it was filed. The indictment points this up by reciting as an overt act that defendant received an installment on his fixed "finder's" fee less than five years before the indictment was filed; that defendant advised principals at Jordan Metal to assure others that he was just selling insurance; by counseling such principals to draw false checks and invoices (referred to in the opening of this opinion) for the sole purpose of hiding his "finder's" fee from the S.B.A. and the Grand Jury. The first count makes it plain that the conspiracy to make false statements and conceal material facts culminated in an inspection conducted by an S.B.A. employee and then in the production of documents to the Grand Jury, both of which events occurred well within the last five years.
A conspiracy does not come to an end because one of its primary objectives, or even its chief objective, has been achieved. United States v. Perrone, 161 F. Supp. 252 (S.D.N.Y.1958). Indeed, the final settling of the conspiracy's financial arrangements "and other acts necessary to complete the operation and consummate the arrangements between (the conspirators)" are as much a part of the conspiracy as the commission of the crime which is its primary object. These basic principles of the law of conspiracy have been followed by this and other Circuits since the Grunewald decision. United States v. Portner, 462 F.2d 678 (2d Cir.), Cert. denied, 409 U.S. 983, 93 S. Ct. 319, 34 L. Ed. 2d 246 (1972); United States v. Colasurdo, 453 F.2d 585, 592 (2d Cir. 1971), Cert. denied, 406 U.S. 917, 92 S. Ct. 1766, 32 L. Ed. 2d 116 (1972); United States v. Nowak, 448 F.2d 134 (7th Cir. 1971), Cert. denied, 404 U.S. 1039, 92 S. Ct. 714, 30 L. Ed. 2d 731 ...