The opinion of the court was delivered by: John G. Koeltl, District Judge
MEMORANDUM OPINION AND ORDER
On October 2, 2002, at the conclusion of a jury trial, the petitioner, Christian Viertel, was convicted on each count of a three-count indictment charging conspiracy to commit mail fraud and wire fraud, as well as substantive counts of mail fraud and wire fraud. The petitioner now moves pro se to vacate or set aside his conviction and sentence under 28 U.S.C. § 2255.
Familiarity with the facts and procedural history of the case are assumed and details are recounted to the extent necessary to decide the present petition. Many of these facts are set forth in the Court's prior Opinion and Order dated May 5, 2005. See United States v. Viertel, No. 01 Cr. 571, 2005 WL 1053434 (S.D.N.Y. May 5, 2005).
The original indictment in this case charged the petitioner, along with Fritz Blumenberg and John Lee, with conspiring to commit mail and wire fraud in connection with the submission of false invoices to Burda Media, Inc., the New York press office for Burda Holding, a magazine and newspaper publisher in Germany. The indictment also charged the three defendants with substantive counts of mail and wire fraud in connection with the false invoice scheme. A superseding indictment filed on February 14, 2002 added two counts of tax evasion against Mr. Blumenberg, the President of Burda Media who maintained substantial control over the company's New York office, including its finances. Mr. Blumenberg pleaded guilty to the charges in Indictment S1 01 Cr. 571 on April 5, 2002 and later testified before the Grand Jury pursuant to a grant of immunity. See id. at *1.
The Grand Jury subsequently returned Indictment S2 01 Cr. 571 against the petitioner and Mr. Lee on June 6, 2002. The indictment charged the petitioner with conspiring with Mr. Blumenberg to commit mail and wire fraud by submitting false invoices to Burda Media from five companies owned by the petitioner (the "Viertel companies"). The indictment also charged the petitioner with substantive counts of mail and wire fraud in furtherance of the conspiracy. See id.
The petitioner's trial began on September 12, 2002. There was substantial evidence at trial that false invoices were submitted to Burda Media from the Viertel companies -- Transvideo, TV Broadcast Center, Inc., Eurocast Corp., Telcopa Ltd., and Agate Reality Corp. Burda Media employees testified that they had never heard of most of the Viertel companies, had never seen work product from the companies to justify the invoices, and had never seen invoices from some of the companies. Moreover, the witnesses testified that the invoices described work that Burda Media had never requested and had no reason to request. The evidence also established that some of the invoices were paid by checks made out to "cash" or to the Viertel companies and that the checks payable to the companies were deposited into bank accounts controlled by the petitioner. The petitioner, through his own accounts and those of the Viertel companies, made payments to Mr. Blumenberg, often by direct payment of Mr. Blumenberg's bills. See id. at *2.
The evidence reflected that Burda Holding funded Burda Media by wiring money from Germany to Burda Media's New York bank account whenever that account fell below a certain level. Burda Media sent paid invoices from New York to Germany by Apex Air Freight on a monthly basis in order to document its expenses. Fraudulent invoices created for the Viertel companies were sent by interstate carrier from New York to Germany on a monthly basis, and regular interstate wires from Germany to New York funded the payments that Burda Media made to the petitioner and Mr. Blumenberg. See id.
Mr. Blumenberg frequently directed Ellen Kiefer, treasurer at Burda Media, to cash checks in payment of invoices from the Viertel companies and to provide that cash to Mr. Blumenberg. Ms. Kiefer became suspicious, and in or about May 1996, advised Burda Holding's attorneys of her concerns. Ms. Kiefer was instructed by these attorneys to continue "business as usual" and not to "change anything while they were investigating." See id.
On June 18, 1996, in a handwritten note, Mr. Blumenberg instructed Ms. Kiefer to issue a check to Agate Reality Media Services for $8120.10 that the petitioner would pick up later that day. Ms. Kiefer issued the check on June 18, 1996, and it was deposited into a bank account controlled by the petitioner the same day. The petitioner deposited this check into his bank account, which depleted Burda Media's bank account and led Burda Holding, on June 24, 1996, to wire $350,000 to Burda Media in order to replenish Burda Media's accounts. On or about June 28, 1996, Ms. Kiefer mailed either a copy of or the original Agate Reality invoice from Burda Media in New York, to Burda Holding in Germany as part of the routine mailing of all invoices. The June 24, 1996 wire of cash from Germany to New York and the June 28, 1996 mailing of the Agate Reality invoice provided the jurisdictional predicates for the substantive wire and mail fraud counts against the petitioner. See id.
At trial, counsel for the petitioner advanced the theory that the petitioner was in fact a victim of Mr. Blumenberg. The petitioner argued that Mr. Blumenberg submitted false invoices to Burda Media from the Viertel companies and then pocketed the proceeds or deposited Burda Media's payment checks into the companies' accounts as loan repayments to the petitioner - all without the petitioner ever knowing that the funds were the product of the submission of fictitious invoices. The Government challenged the petitioner's loan repayment theory and instead portrayed the payments as kickbacks. See id. at *3.
At the conclusion of the Government's case, the petitioner made a motion for dismissal of the charges and entry of a judgment of acquittal pursuant to Federal Rule of Criminal Procedure 29. With respect to the mail and wire fraud charges, the petitioner argued that Burda Holding already knew of the fraud at the time of the June wiring and mailing, and that neither of these acts truly advanced the fraud. The petitioner also argued that he had received payment for the Agate Reality invoice before the mailing occurred and that the evidence did not establish that the June 18, 1996 check to Agate Reality had triggered the subsequent June 24, 1996 wire. With respect to the conspiracy charge, the petitioner argued that the evidence did not show that he had seen the actual invoices or that he knew that the checks deposited into his bank account were issued pursuant to fraudulent invoices. See id.
The Court denied the defendant's Rule 29 motion. The Court noted:
[The alleged mail and wire fraud scheme] was not simply fraud by which a payment was made but a scheme whereby the funds to obtain the money for the payment would be obtained from Burda in Germany such that, pursuant to the scheme, an invoice would be sent to Germany, where it would be kept, and that the funds of Burda in New York would be replenished by wires from Burda in Germany such that Burda in New York would have sufficient ongoing funds.
The Court also noted that there was sufficient evidence from which the jury could find that there was an agreement between the petitioner and Mr. Blumenberg to engage in a scheme to defraud and that the scheme to defraud had as its objects mail fraud and wire fraud. On October 2, 2002, the jury returned a verdict finding the petitioner guilty on all three counts of the indictment. See id.
On June 9, 2003, the Court sentenced the petitioner to a term of twenty-one months' incarceration, to be followed by three years' supervised release, restitution in the amount of $345,673.96, a fine in the amount of $5,000, and a mandatory $300 assessment. At sentencing, the Court rejected the petitioner's argument that the checks issued by Burda Media and deposited into the petitioner's bank accounts were actually repayments of personal debts that Mr. Blumenberg owed to the petitioner. The Court noted that the Government had shown by more than a preponderance of the evidence that the petitioner had participated with Mr. Blumenberg in the fraud, and that the bank accounts of the petitioner and his wife were used to siphon money from Burda Media. The frequency of the payments into these accounts, the odd amounts of the payments, and the fact that a number of the checks had been endorsed by the petitioner and his wife, indicated that the accounts were used to facilitate the fraud and that the petitioner was in fact aware of the fraud. The restitution amount, $345,673.96, represented the total ...