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United States v. Biasucci

March 17, 1986

UNITED STATES OF AMERICA, PLAINTIFF-APPELLEE,
v.
JOSEPH BIASUCCI, JESSE DAVID HYMAN, A/K/A "DOC," STANLEY GRAMOVOT, ALAN ALBENGA, MELVIN COOPER, ANTHONY CHARLES CAPO, JR., OSCAR LOUIS ALBENGA, A/K/A "AL" AND CHAIM GERLITZ, DEFENDANTS-APPELLANTS



Appeal from judgments of the United States District Court for the Southern District of New York entered after a jury trial before Judge Leonard B. Sand, in which appellants were convicted of various RICO Act violations, 18 U.S.C. §§ 1961-1968, and of extortionate credit transactions, 18 U.S.C. §§ 891-896. Claims of unlawful video surveillance, improper mens rea instructions, double jeopardy and prosecutorial misconduct are rejected and the convictions are affirmed.

Author: Miner

Before: TIMBERS, PIERCE and MINER, Circuit Judges.

MINER, Circuit Judge :

Eight defendants appeal from judgments of conviction entered following a jury trial in the United States District Court for the Southern District of New York (Sand, J.) stemming from their involvement in a loansharking operation. Their principal contentions on this appeal are that certain videotapes recorded by a camera surreptitiously installed in a private business office should have been suppressed, that misconduct on the part of the prosecutor deprived them of a fair trial, that the trial court erroneously charged the jury on the state of mind the government must prove to establish the "collection of an unlawful debt," and that imposition of consecutive sentences for convictions under two statutes violated the double jeopardy clause of the Fifth Amendment. Finding that none of these or any of appellants' other arguments warrant reversal, we affirm the convictions in all respects.

I. BACKGROUND

Appellants Joseph Biasucci, Jesse David Hyman, Melvin Cooper, Oscar Louis Albenga, Alan Albenga, Stanley Gramovot, Anthony Capo, Chaim Gerlitz, and seven others were indicted for a variety of Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. §§ 1961-1968 (1982) ("RICO"), and extortion, 18 U.S.C. §§ 891-896 (1982), offenses.*fn1

The charges against appellants stemmed from ten loans totaling approximately two-million dollars made by Resource Capital Group ("Resource Capital") in 1981 and 1982. Hyman and Cooper, who directed Resource Capital, were the central figures in these transactions. They conducted the scheme by drawing in customers with credit problems through promises of legitimate financing. They then would tell their customers that those funds were unavailable, but that the customers could get "emergency funds" at interest rates of one and one-half to five percent per week. As part of the effort to conceal the true nature of these transactions, the customers were obliged to sign documents falsifying the actual interest rates. Customers also were required to provide mortgages on their property, or shares in their businesses, as security for the loans. Interest payments were due weekly, and when the borrowers had difficulty meeting the payments, they were threatened with loss of their property, loss of control of their businesses, or physical injury.

The other appellants were involved with the loansharking operation in various ways. Biasucci and Gerlitz made funds available to Hyman and Cooper to operate the loansharking business and shared in the illicit profits collected from the business's customers. Gramovot brought one of the enterprise's victims to Resource Capital and later shared in the effort to take control of her business. Oscar Albenga was the chief collector of money from victims and Alan Albenga worked under this direction. Capo physically assaulted one of the enterprise's victims and, together with several other defendants, attempted to force that victim to sign over his interest in his business to the defendants.

At trial, the government established the existence of this racketeering enterprise and its loansharking activities principally through the testimony of victims of the loansharks, over 100 tape-recorded conversations from the Resource Capital offices and other locations, several videotapes recorded by a camera that had been surreptitiously installed in the Resource Capital offices, and various records and documents seized from the Resource Capital offices. After a thirteen-week trial and five days of deliberation, the jury returned guilty verdicts against the eight appealing defendants on various counts of the indictment and acquitted seven other defendants on all counts.*fn2

This appeal presents essentially four issues. First, appellants argue that the visual electronic surveillance of the Resource Capital offices, conducted pursuant to a court order, was improper because no statutory authority provided for such surveillance, and that even if authority did exist, the government failed to demonstrate a valid basis for such surveillance. Second, they contend that the RICO statute, 18 U.S.C. §§ 1962(b) and (c), required that the government establish that each defendant had specific knowledge of the actual rate of interest charged on a usurious loan and that Judge Sand's failure to so instruct the jury was error. Third, appellants argue that they were deprived of a fair trial by certain acts of prosecutorial misconduct. Finally, Hyman and Cooper claim that the same conduct formed the basis for their convictions under both section 1962(b) and section 1962(c) and that consecutive sentences on these convictions, therefore, violated the double jeopardy clause of the Fifth Amendment. Finding these arguments, as well as all others presented by appellants, to be without merit, we affirm the convictions.

II. DISCUSSION

A. Visual Electronic Surveillance

On November 30, 1982, District Judge Thomas C. Platt issued an order pursuant to Fed. R. Crim. P. 41 and 57(b) authorizing Federal Bureau of Investigation ("FBI") agents to enter the Resource Capital offices and install a hidden video camera, which would record the movements of all persons who entered the premises over a thirty-day period.*fn3 Prior to trial, the defendants unsuccessfully moved to suppress the fruits of this surveillance, and the government thereafter offered into evidence ten of the videotapes. Appellants Hyman, Cooper, and Gerlitz argue that this surveillance was improper because no statutory authority provided for video surveillance in domestic criminal investigations, and even if authority did exist, the government failed to demonstrate a valid basis for such surveillance.

Appellants correctly note that Title III of the Omnibus Crime Control and Safe Streets Act of 1968, 18 U.S.C. §§ 2510-2520 (1982), which authorizes federal judges to issue warrants (orders) for domestic wiretapping and electronic eavesdropping, does not authorize federal courts to permit visual electronic surveillance of private premises. United States v. Torres, 751 F.2d 875, 880 (7th Cir. 1984), cert. denied, 470 U.S. 1087, 105 S. Ct. 1853, 85 L. Ed. 2d 150 (1985); United States v. Ianniello, 621 F. Supp. 1455, 1467 (S.D.N.Y. 1985); In re Order Authorizing Interception of Oral Communications and Videotape Surveillance, 513 F. Supp. 421, 422-23 (D. Mass. 1980); People v. Teicher, 52 N.Y.2d 638, 652-53, 439 N.Y.S.2d 846, 853, 422 N.E.2d 506, 513 (1981); Sponick v. City of Detroit Police Department, 49 Mich. App. 162, 198, 211 N.W.2d 674, 690 (Mich. Ct. App. 1973). The statute sanctions only the "interception of wire or oral communications." 18 U.S.C. §§ 2516(1), 2518(1) (1982); cf. United States v. New York Telephone Co., 434 U.S. 159, 166, 54 L. Ed. 2d 376, 98 S. Ct. 364 (1977) (pen registers are not governed by Title III because they are not concerned with "the aural acquisition of the contents of any wire or oral communication " (emphasis in original)).

Nor does the Foreign Intelligence Surveillance Act of 1978, 50 U.S.C. §§ 1801-1811 (1982) ("FISA"), which is broad enough to embrace visual electronic surveillance, id. § 1801(f), authorize such surveillance in domestic criminal investigations. The FISA allows the government to use electronic surveillance only for the purpose of obtaining "foreign intelligence information." Id. § 1804(a)(7)(B); see United States v. Duggan, 743 F.2d 59, 77-78 (2d Cir. 1984) (FISA warrant properly limited to foreign intelligence ...


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