United States District Court, E.D. New York
Barry Drayer, Pro se, Otisville, NY.
For the Respondent: Steven Lawrence Tiscione, Assistant United States Attorney, United States Attorney for the Eastern District of New York, Brooklyn, NY.
MEMORANDUM OF DECISION AND ORDER
ARTHUR D. SPATT, United States District Judge.
On February 11, 2011, the Petitioner Barry Drayer (the " Petitioner" ), pro se, filed this petition for a writ of habeas corpus pursuant to 28 U.S.C. § 2255. The Petitioner, who is presently incarcerated and serving a sentence of 138 months followed by supervised release for a term of three years, claims that his trial counsel were ineffective. He also suggests that his appellate counsel was similarly ineffective for their failure to raise his ineffective assistance of counsel arguments on his first direct appeal. In addition, the Petitioner has filed two letter motions seeking to conduct discovery and to amend his petition.
For the reasons that follow, the letter motions and the petition are denied.
A. The Lending Practices of RW Professional Leasing Services, Inc.
From 1991 through mid-2002, the Petitioner led a complex fraud scheme through RW Professional Leasing Services, Inc. (" PLS" ), which was a company he controlled. In this regard, PLS provided financing
to medical professionals who wanted to purchase new medical equipment or obtain funding in connection with maintaining a medical practice. PLS operated out of two offices, one in Island Park, New York, and the other in Massachusetts. The Massachusetts office handled collections, credit, customer service, and all dealings with lenders and funding sources. The Petitioner managed the Massachusetts office of PLS on a day-to-day basis, and also made decisions for the company as a whole. He was officially the Vice-President and a Director, but he called himself the chief executive officer of the company.
However, PLS did not originate the funding for the loans it issued, but rather acted as the financing broker. In this capacity, PLS arranged to obtain financing for medical professionals from lending institutions, and also serviced the loans after they were issued. PLS typically engaged in three types of transactions: (1) equipment leasing transactions, in which PLS would directly buy equipment chosen by a medical professions and lease the equipment back to the doctor; (2) sale-leaseback transactions, in which a doctor would sell existing equipment to PLS and PLS would lease the same equipment back to the doctor; and (3) working capital loans, in which money was lent to the doctor without any specific collateral, other than a blanket lien against the practice.
PLS had relationships with a variety of financial companies to either provide capital loans directly to the borrower, or lend PLS funds for the purpose of entering into leases with medical providers. These funding sources included federally-insured community banks, through a broker known as Crawford & Sons, and non-bank lenders such as AT & T Capital and First Sierra.
The federally-insured community banks, such as Alliance Bank, Northwest Bank, and People's Bank, engaged in portfolio lending, in which the bank would lend money to PLS based on an agreement that included a portfolio or group of equipment leases. Under the terms of the agreements, PLS typically serviced the loans that were made to the medical providers. If an individual borrower, such as a doctor, prepaid the loan by paying the balance of the loan early, PLS was required to either remit those proceeds to the funding institution or substitute the paid off lease with a new lease of equal value. Similarly, if a borrower defaulted or went bankrupt, PLS was required to either pay the bank or substitute another transaction.
The non-bank lenders, First Sierra and AT & T Capital, serviced their own loans. First Sierra and AT & T used a " lock-box," in which invoices under the PLS name were sent to the doctors, and the doctors wrote checks payable to PLS, and PLS forwarded the checks to a mailbox under the lender's control. If a doctor's payment was late, PLS had the obligation to collect money from the doctor. If the borrower defaulted, PLS was responsible to pay the full amount of the loan to the lender. If a doctor went bankrupt, PLS was required to notify the lender and pay the loan in full or " substitute" it, that is, PLS would finance another loan with its own money and then assign the stream of payments to the lender.
Within this framework, under the direction of the Petitioner, PLS devised a number of schemes to defraud the funding institutions by concealing the nature of the collateral, the distribution of the loan proceeds, and the payments made on the loans. These schemes included, but were not limited to, the following: (1) the use of phony and forged financial instruments; (2) the " Mailbox Etc." and " Pay Ahead" scheme; (3) the multiple lending scheme; (4) the Riteway and GHT sham companies;
(5) the Hospitality Services of Middle Tennessee (" HSMT" ) scheme; (6) the Carefree and MedPro conspiracy; and (7) the concealment of records from auditors. These schemes are discussed in more detail below. Of note, the Petitioner made millions of dollars in commissions from the scheme, while the lenders lost tens of millions of dollars. In 2002, the scheme collapsed, when the Petitioner and his co-defendants were arrested.
B. The Fraudulent Schemes and the Evidence at Trial
1. The Use of Phony and Forged Financial Instruments
One of the first schemes devised by PLS was developed to trick the lending institutions into accepting payments from PLS on behalf of borrowers. Under the " lock-box" system, which PLS arranged with the non-bank lenders, the borrower was required to send payments directly to the bank. First Sierra accepted payments from PLS on behalf of borrowers from time to time, but would require proof that a doctor had actually paid PLS before accepting the payment directly from PLS. To fulfill this requirement, PLS created altered or forged financial instruments purporting to show that borrowers had paid PLS. This scheme prevented the lender from learning that the borrower had stopped making payments for one reason or another, which would have required PLS to remit the remaining balance of the loan.
The phony check scheme was offered to the jury through the testimony of the actual employees who forged the phony checks and documents. Frank Zambaras testified that he scanned and altered checks through the use of a computer at the request of the Petitioner's brother, Roger Drayer. Zambaras altered the amount on the checks, the dates on the checks and check numbers by scanning the checks into a computer and using digital imaging editing software to make the alterations. Roger Drayer supplied Zambaras with the checks to be altered with a note affixed to them as to what modifications were needed on the checks. Roger Drayer told Zambaras that there was nothing wrong with the alterations because the checks were not being presented for payment, but only for false proof that the doctors had paid PLS. When Zambaras was unwilling to continue forging the checks, he showed Roger Drayer how to scan and modify the checks on the computer using Corel Photo Paint.
PLS also created phony telechecks, which are documents that show proof of payment by telephone. These phony documents were used for the same purpose as the phony checks. Jennifer Tarantino, Roger Drayer's daughter and the Petitioner's niece, testified that she created these phony documents. PLS generated between 1,000 and 1,500 of the telechecks to submit to the banks as phony evidence of proof of payment. Tarantino testified that, pursuant to the Petitioner's written instructions, she and other employees in New York created unauthorized telechecks to make it look like the doctors had paid their monthly bill to PLS on outstanding loans, when in fact they had not. Tarantino stated that she participated in this fraudulent conduct daily for a total period of two years.
Adam Drayer, Tarantino's brother and Roger Drayer's son, testified that he created false Western Union receipts along with employee Zambaras, for the same purpose of providing the banks with phony proof that a doctor had submitted payment to PLS.
All of these witnesses testified that they created these false instruments at the direction
of the Petitioner. According to Roger Drayer: " [The Petitioner] had called me one day and asked me to go to Frank [Zambaras] and ask Frank if we could take a check that was already there, and alter the date or the check number or the amount on it. Not for the purpose of cashing it, but for the purpose of sending it as proof to request a payment that was made." (Tr. 1392-93). Roger Drayer also testified that he acted at the Petitioner's direction when he instructed employees of the New York office to fax lists of accounts requiring phony telechecks to be created, and when he diversified the scheme to include phony Western Union money grams.
2. The " Mailbox Etc." and " Pay Ahead" Scheme
A second scheme involved the use of accounts at Mailbox Etc., to intercept invoices sent by First Sierra and AT & T intended for PLS borrowers. PLS used this scheme for borrowers who had gone bankrupt or prepaid the amount of the loan. Instead of notifying the financial institution of the bankruptcy, or remitting the prepayment as required, PLS concealed the fact and kept the funds for its own use. This became more prevalent toward the ...