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United States v. Tzakis

June 11, 1984


Appeal from a judgment of conviction entered in the United States District Court for the Southern District of New York, Cannella, J., on ten counts of wire fraud, 18 U.S.C. § 1343, seven counts of travel fraud, 18 U.S.C. § 2314, and one count of conspiracy, 18 U.S.C. § 371. Judgment affirmed.

Lumbard, Newman and Pratt, Circuit Judges.

Author: Pratt

PRATT, Circuit Judge:

Ioannis Tzakis appeals from a judgment of conviction entered in the United States District Court for the Southern District of New York after a jury trial before John M. Cannella, Judge. None of defendant's contentions on appeal warrants extensive discussion; we write this opinion primarily to address a novel claim concerning the imposition of restitution as a condition of probation under 18 U.S.C. § 3651 (1982). On that issue we conclude that the district court did not abuse its discretion by imposing joint and several liability on Tzakis and his codefendant, Melvin Hunter, for the full amount of restitution, rather than apportioning liability for restitution between them. Rejecting defendant's other contentions as meritless, we affirm his conviction and sentence.


Tzakis and his codefendant, Hunter, posing as successful international financiers, engaged in a series of schemes whereby they approached businessmen in need of substantial sums of money and convinced them to put up advance fees in reliance on promises to provide them with low interest loans. To induce the victims to part with their money, Tzakis and Hunter made fraudulent representations that they had access to billions of dollars and that they had previously funded many loan transactions. Defendants never provided a single loan to any of those who paid advance fees, and, although they had promised to refund the "advance" monies if the loans were not provided within 20 banking days, no advance fee was ever refunded. Hunter was the central figure in this fraudulent scheme, but Tzakis did participate extensively and he shared in its proceeds.

Soon after Hunter was arrested and incarcerated at the Metropolitan Correction Center in Manhattan, he made two long distance phone calls to Tzakis, who had not yet been arrested. Hunter arranged the calls through a fellow inmate, Robert Guccione, a prisoner awaiting sentence, who was eager to cooperate with law enforcement authorities. Acting on his own initiative, Guccione placed the calls through his wife, who would set up three-way conference calls among Hunter, Tzakis, and herself. Prior to making the arrangements for these calls, Guccione told Hunter that his wife would remain on the phone during the conversations in order to make sure he was still connected, and that she would be aware of what was said during these conversations. Hunter did not object to these conditions.

What Guccione did not tell Hunter was that he had directed his wife to record these conversations. After Hunter's calls had been taped for three days, Guccione told an FBI agent about the taped calls. The agent instructed him to stop taping and to turn over any tapes that had already been made.

Tzakis, Hunter, and another codefendant were subsequently charged with eleven counts of wire fraud, in violation of 18 U.S.C. § 1343, eight counts of travel fraud, in violation of 18 U.S.C. § 2314, and conspiracy, in violation of 18 U.S.C. 371. At his arraignment on May 27, 1982, Tzakis was instructed by Judge Brieant, who handled the pretrial stage of this case, to file all appropriate pretrial motions by July 1, 1982. Through counsel he filed only one such motion -- for discovery.

In October, Tzakis's original counsel withdrew from the case. Subsequently, Tzakis on a number of occasions guaranteed the court he would retain new counsel, but then repeatedly appeared in court without an attorney, always assuring the judge that next time he would appear with an attorney. On the morning of January 10, 1983, Tzakis, still unrepresented by counsel, called Judge Brieant's chambers from Chicago to say he might not be able to return to New York for that day's hearing because he "threw his back out". In Tzakis's absence, Judge Brieant went ahead with the scheduled hearing on the suppression motions filed by codefendant Hunter. Guccione testified at the hearing and was questioned by Hunter's counsel.

Tzakis next appeared in court on January 21, 1983, still without counsel. He was told that he must reappear on February 2 with counsel, or the court would re-examine his bail status. When Tzakis appeared on February 2, again without counsel, Judge Brieant temporarily revoked his bail. The next day counsel appeared for Tzakis and promised to file all pre-trial motions by March 1. Even that promise was not kept, however, for it was not until March 30 that Tzakis moved on various grounds to suppress the Hunter-Tzakis tapes. During argument of the motion on April 8, Tzakis's counsel suggested that the court reopen that hearing, mainly for the purpose of cross-examining Guccione further. The court declined to do so, concluding that Hunter had a full and fair opportunity to cross-examine Guccione and that Tzakis had not given the court any reasons to justify recalling him.

Judge Brieant then denied the suppression motions, finding that Guccione was a credible witness and that he had told Hunter that his wife would be listening to Hunter's calls. Thus, the judge concluded, Hunter had consented to Mrs. Guccione's interception of the calls within the meaning of 18 U.S.C. § 2511(2)(d).

A two-week trial of both Tzakis and Hunter was then held before Judge Cannella. At the conclusion of the government's direct case, the prosecution moved to dismiss counts 7 and 12 of the superseding indictment. Both Tzakis and Hunter were convicted on the remaining counts, and Tzakis was sentenced to a total of seven years' imprisonment, consisting of concurrent two-year terms on counts 1 through 6, plus concurrent two-year terms on counts 8 through 11 to be served consecutively to the sentences imposed on counts 1 through 6, plus concurrent three-year terms on counts 13 through 19 to be served consecutively to the other sentences. The court also imposed a total of $90,000 in fines and ordered Tzakis to pay the costs of prosecution.On count 20, which charged a conspiracy to conduct the overall fraudulent scheme, the court suspended imposition of sentence, placing Tzakis on five years' probation to follow his consecutive jail sentences, and ordered, as a special condition of probation, that Tzakis pay restitution aggregating $400,000, to the five groups that had been victimized by the frauds.

Hunter's initial sentence on the same counts was for a study and report on his mental condition ordered pursuant to 18 U.S.C. § 4244. On April 2, 1984, after oral argument of this appeal, the district court imposed on Hunter a final sentence that was identical to the one imposed on Tzakis. Judge Cannella included the same condition for restitution to the victims, and he indicated that the total restitution ...

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