Opposition Brief — Berenbeim v. United States

een |

CITATIONS

Cases:

Terry v. United States, 131 F. 2d 40______..-.------.--- . 2,16

United States v. Gilliland, 312 U. 8. 86

Statutes involved:

The Soldiers’ and Sailors’ Civil Relief Act, as amended,56

Stat. 774 (50 U.S. C. App. 540-548):

-

a

27

27

28

29

29

29

30

Veterans’ Administration Forms:

. Form 380 (8 F. R. 2760)

Form 381 (8 F. R. 2761)

773597—48——-1

2

and a petition for rehearing was denied Decem-

ber 10, 1947 (R. 1059). The petition for a writ

of certiorari was filed January 2, 1948. The

jurisdiction of this Court is invoked under Sec-

tion 240 (a) of the Judicial Code, as amended by

the Act of February 13, 1925. See also Rules

37 (b) (2) and 45 (a), F. R. Crim. P.

QUESTIONS PRESENTED

The principal questions presented are:

1. In determining whether an insurance con-

tract was made more than 30 days before the

insured entered the armed forces, whether the

significant date is the date on which the applica-

tion for insurance was made or the antedated

date which appears on the face of the policy.

2. Whether the decision below is in conflict

with Terry v. United States, 131 F. 2d 40

(C. C. A. 8).

3. Whether there is sufficient evidence showing

that the defendants made false reports to the

Veterans’ Administration and conspired to de-

fraud the United States.

4. Whether the instruction to the jury on the

issue of good faith was incorrect, and, if so,

whether the failure of petitioners to object to it

on the ground now asserted forecloses them from

attacking it here.

STATUTES INVOLVED

The pertinent statutory provisions are set forth

in the Appendix, infra, pp. 27-30.

3

STATEMENT

On December 14, 1945, petitioners and the de-

fendants Mankoff and Stoeffler were indicted in

the United States District Court for the District

of Colorado in one count charging that they un-

lawfully conspired to defraud the United States

and to violate the false claims statute (Section

35 (A) of the Criminal Code, infra, pp. 29-30), in

violation of Section 37 of the Criminal Code,

infra, p. 30 (R. 14-53). The indictment alleged

that the defendants agreed that they would, by

the fraudulent means set forth, eause the Veterans’

Administration to guarantee, pursuant to the pro-

visions of the Soldiers’ and Sailors’ Civil Relief

Act, the payment of premiums on certain life-in-

surance policies which the defendants caused to be

issued to persons who had entered or were about

to enter the armed forces; that the defendants

falsely made it appear that the policies were in

force on a premium-paying basis at the time of the

application for benefits under the Act and that a

premium had been paid not less than 30 days before

the insured entered the armed forces; that if the

true facts had been made known to the Veterans’

Administration the premiums on the policies

would not have been guaranteed; and that the

conspiracy contemplated impairing and obstruct-

ing the Veterans’ Administration in the exercise

of its governmental function in administering the

Soldiers’ and Sailors’ Civil Relief Act.

a

Having been convicted by a jury (R. 64), peti-

tioner Berenbeim was sentenced to imprisonment

for two years and to pay a fine of $2,500 (R. 65).

Petitioner Schechter was sentenced to imprison-

ment for two years and tc pay a fine of $1,000

(R. 65-66). Upon appeal to the Circuit Court

of Appeals for the Tenth Circuit, the judgments

were affirmed (R. 1050-1051). .

The issues presented by the petition for a writ

of certiorari are mainly questions of law which

may be resolved without a detailed analysis of

the evidence adduced at the trial. Accordingly,

we shall confine the Statement to a generalized

summary of the conspiracy, as shown principally

by the Government’s evidence, and a sample illus-

tration in detail of how it operated in a specific

instance.

Preliminarily, it may be noted that as one phase

of its effort to relieve members of the armed

forces from civil obligations until they were re-

stored to civil life, the Congress authorized the

Veterans’ Administration to guarantee the pay-

ment of premiums on certain life insurance

policies, not in excess of $10,000. The guarantee

provisions (ifra, p. 27) were confined, inter alta,

to a contract of insurance (1) ‘“‘which [was]

in force on a premium-paying basis at the time”’

the application for benefits under the Act was

made, and (2) “‘which was made and a premium

paid thereon * * * not less than thirty days

before the date the insured entered into the mili-

ee ee OO

tary service” (sec. 400 (a)). Consistently with

sections 402 and 407 of the Act, the Veterans’ Ad-

ministration prepared forms for use in applying

for benefits under the Act.’ Form 380 (8 F. R.

2760) was required to be submitted by the in-

sured, and it required information which would

enable the Veterans’ Administration to deter-

mine whether the insured was eligible for the

benefits provided by the Act. In practice, Form

380 was submitted by the member of the armed

forces to the Veterans’ Administration and a

copy was forwarded to the insurer. Upon re-

ceipt of such a form, the insurer submitted Form

381 (8 F. R. 2761) to the Veterans’ Administra-

tion, which furnished that agency with pertinent

information concerning the policy If, upon con-

sideration of the information shown by the two

forms, the Veterans’ Administration determined

that the policy was within the terms of the

statute, the Administration sent its Notice of

Approval to the insurer and insured, and for the

duration of the insured’s military service and

two years thereafter the Government guaranteed

the payment of premiums.

Petitioner Berenbeim, a member of the bar of

Colorado (R. 491), was the ‘“‘State Manager”’ for

the Ancient Order of United Workmen of Kan-

sas, a fraternal benefit association, in the sale of

insurance in Colorado (see R. 79-87). Petitioner

Regulations also were promulgated (7 F. R. 10232-10235).

FOOTE

et TION oe te eee

Schechter and defendant Mankoff were subagents

who sold insurance under Berenbeim’s direction

(R. 496-498, 407). Defendant Stoeffler worked

‘for Schechter in the sale of such insurance (R.

413, 565). On all insurance which was sold,

Berenbeim received a commissioa of 824oJof the

first year’s premium and a diminishing rate for

premiums paid in the following years (R. 81,

406).? He paid a commission of 70% of the first

year’s premium to Schechter and Mankoff for

policies which they sold (R. 407, 420, 623).

Schechter had a special arrangement with

Stoeffler (R. 714, 413).

The ultimate objective of the conspiracy was to

secure the Veterans’ Administration guarantee of

premiums on policies of insurance which were

sold by petitioners and their codefendants to

young men immediately before they entered the

armed forces. In operation the scheme worked

as follows:

Mankoff, Stoeffler, and Schechter, the salesmen,

sought out young men who had been called for

military service and who were on brief furloughs

before reporting for active duty. They repre-

sented to these young men that they could obtain

insurance at no cost to themselves; that the pre-

miums would be guaranteed by the Government;

that twe vears after they were released from mili-

* These terms were later modified to pay Berenbeim an

additional $5 for each $1,000 of insurance which was sold

(R. 84-85).

7

tary service, they could elect whether to keep the

poliey and commence paying the premiums; and

that in any event they would be under no obliga-

tion to pay the premiums which accrued while the

guarantee was in effect (see, e. g., R. 197-198,

210-212, 230-231, 246-247). Whenever a pros-

pect agreed to the proposition, the agent would

have him sign three different blank forms, an

application for an insurance policy, medical

report and an application to the Veterans’ Admin-

istration to bring the policy under the gurantee

provisions of the Act (see e. g., R. 199-201, 212-

213, 232-233, 247-248). In addition, the prospect

was given a form which he was to forward to the

agent as soon as he reported for active duty, show-

ing his serial number, rank, organization, identi-

fication number, branch of service and the date on

which he entered active duty (see, e. g., R. 201,

212, 258). ‘The agents secured the routine infor-

mation from the applicant as to his birthdate,

beneficiary, etc, (R. 231, 252, 275). The appli-

cant never paid any premiums (see, e. g., R. 214-

215, 238, 247, 279). Instead, the agent paid the

monthly premiums until the guarantee was ob-

tained (R. 582, 693, 707, 720), after which no

further premiums were paid.

The agent filled in the application for insurance,

which the applicant had signed in blank, in each

case requesting a $10,000 policy (the maximum

for which a guarantee was available under the

773597482

8

Act), and in each case dating the application as —

of the first day of the month regardless of the

date on which it was actually made (see R. 768-

769, 784-785, 816-817), so as to show that the pol-

icy had been in existence more than 30 days before

the insured entered the armed forces (see R.

684). The medicai form was completed by the

agent and a doctor who worked with him, but

who did not see the applicants (R. 567-568, 592;

see also, e. g., R. 198, 785-792, 212, 849-857). The

application and medical form were then submit-

ted to Berenbeim, who in turn forwarded them

to the home office of the company (R. 498). In

due course the policies issued and were forwarded

to Berenbeim (R. 135, 498). Except in a few

cases, the policies were not delivered to the per-

sons who had applied for them (see, e. g., R. 201,

234, 259, 279). ;

In the meantime, the insured had reported for

active duty and had returned to the agent the

form which was previously given him, and the

agent had filled in the Veterans’ Administration

Form 380, which the insured had signed in blank

(R. 420, 585, 604, 606). The form, which was

an application for benefits under the Act, was

forwarded by Berenbeim (R. 410, 644) to the

Veterans’ Administration, a copy being sent to

the insurer. In filling in the form, the agent

falsely stated that a premium had been paid

more than 30 days before the insured entered the

—

armed forces (see, supra, p. 7); that the policy

was in the possession of the beneficiary named in

it (see, supra, p. 8);* and that the form was

signed by the insured on a given date at Denver,

Colorado—at a time when the insured was present

some other place on active duty in the armed

forces (see, e. g., R. 202, 213, 235, 248, 306, 321).

On the basis of its records, the insurer sub-

mitted Form 381 to the Veterans’ Administration

showing that the contract was made and the first

premium was paid more than 30 days prior to

the insured’s entry into the armed forces (R.

128, 137; see R. 940-942, 957-960). As soon as

the Veteraris’ Administration approved the appli-

cation and guaranteed the premiums, the insurer

credited Berenbeim with his commission on the

first year’s premium and he, in turn, paid Man-

koff and Schechter their commissions (R. 409-

410, 162-163). While the premiums, and there-

fore the commissions, varied, Mankoff and Schech-

ter received over $300 in first-year commissions

on each policy they sold and Berenbeim received

over $150 on each one (see R. 453-457). The

extent of the agents’ sales is illustrated by Man-

koff’s statement to an F. B. I. agent that during

the month of May 1943, he sold 25 policies (R.

424), thus earning commissions of over $7,500 for

the month.

’ Mankoff testified (R. 628) that it was his practice to state

that the policy had been delivered to the insured’s beneficiary,

even though it had not been so delivered.

—

10

The Government’s witnesses included sixteen

young men who had been ‘‘sold’’ insurance in

the manner contemplated by the conspirators,

While there are some factual variations, the sig-

nificant features of the conspiracy manifested

themselves in each instance. Thus, for example, —

the witness Pepper testified that he reported for

active military duty in the Army on August 26,

1943 (R. 396). About a month before this, while

he was waiting to be called to active duty, peti-

tioner Schechter undertook to ‘‘sell’’ him a $10,-

000 insurance policy (R. 396-397). Pepper testi-

fied (R. 397)— :

* * * the insurance was explained to

me as a policy that contained no war

clause, and that I could take out a $10,000

protection to my beneficiary, and it would

have no cost to myself, and then in the

event that I wanted to continue it when I got

out of service, I would have two years to

either convert the policy or make up my

mind about it, and in the event I wanted

to drop the policy I could do so with no cost

to myself.

Pepper had some doubts ‘‘because I couldn’t

figure out how you could possibly have insurance

without paying for it,’’ but Schechter told Pep-

per ‘“‘to leave it to him, because I wouldn’t be

liable for any premiums” (R. 397). On the

basis of these representations, Pepper signed an

application for a $10,000 policy and furnished

Schechter with the requisite information concern-

il

ing his birthdate, beneficiary, ete. (R. 398, 912-

913). The application form stated that the in-

surance was to be effective as of June 1, 1943,

and it recited that the monthly premium of $51:20

was collected and remitted (R. 913). The form

also provided that the applicant agreed that “the

policy to be issued hereon shall have no binding

force until actually delivered to me, and the

first premium paid and accepted by the Order”’

(see R. 913, 769). At the same time Pepper

signed (R. 399) a medical examiner’s report

(R. 913-921): and Veterans’ Administration

Form 380 (R. 921-923), both of which were filled

out at a later time by Schechter and a doctor who

cooperated with him (see R. 567-568, 585, 592-

594). Contrary to the statement in the applica-

tion form, Pepper did not pay any sum of money

to Scheehter (R. 398). Pepper testified further

that he had not been pliysically examined by the

doctor who certified on the medical report that

such an examination had been made (R. 398-

399), that when he signed the blank form he did

not know what kind of insurance he was to get

or the amount of the premiums (R. 399), and

that he never did receive a policy of insurance

(R. 399).

While there was no specific testimony as to the

handling of the various forms by Schechter, it

appears that they were treated in the usual man-

ner. Schechter appears to have filled in the ap-

12

plication form, a ‘‘Dr. Wilkoff’’ signed the medi-

eal report (R. 920), and these documents were

then forwarded by Berenbeim to the insurer,

where they were received on June 30, 1943 (see

R. 913, 921). A policy was issued by the com-

pany and forwarded to Berenbeim on July 7,

1943 (see R. 921).

On August 26, 1943, Pepper reported for active

_ military duty (R. 396). Thereafter, Schechter

filled in the Form 380 which Pepper previously had

signed in blank and copies of the form were sent

to the Veterans’ Administration and the insurer

(see R. 927, 921). In the form, which was sub-

mitted under Pepper’s signature (see R. 923),

Schechter stated, inter alia, that the last premium

paid on the policy was paid July 1, 1943; that the

policy was in the possession of ‘“‘Joseph Pepper,

832 Garfield St., Denver, Colo.’’*; and that the

form was signed by Pepper on August 29, 1943,

at Denver, Colorado (R. 922-923), In truth,

Pepper never had paid a premium on the policy

(R. 398); he never saw the policy which was

issued for him by the insurer (R. 399); and he

did not sign the Form 380 on August 29, 1943,

at Denver, Colorado, for at that time he was on

active military duty at Fort Logan (R. 399).

On September 2, 1943, the insurer filed Form

381 with the Veterans’ Administration (R. 924-

927), in which it was stated, inter alia, that the

* See footnote 3, supra, p. 9.

2 ee RHE Nn eet

policy was effective June 1, 1943; that a premium

was paid on the policy on July 1, 1943; that the

snsurance contract was made and the first pre-

mium paid on June 1, 1943; and that the policy

had been delivered to Joseph Pepper, the bene-

ficiary. On December 9, 1943, the insurer re-

ceived a Notice of Approval from the Veterans’

Administration guaranteeing the premiums

(R. 924).

ARGUMENT

It is manifest from the abundant evidence

adduced at the trial that everyone with whom the

defendants dealt was deceived, and this, it is

plain, was the result contemplated by the con-

spiracy. The young mén who ‘‘bought’’ insurance

immediately prior to entering active military duty

did so because they were led to believe that they

were getting valuable protection for nothing. The

insurer was induced to issue policies to the vari-

ous applicants on the basis of false medical

reports and apparently without knowledge that

the applicants had been deceived into signing the

necessary papers. And the Veterans’ Adminis-

tration was induced, by means of the defendants’

deception, into guaranteeing the premiums on

eontracts of insurance which had not been made

more than 30 days before the date on which the

insured entered the military service and on which

no premium had been paid by the insured, as the

statute requires. The fraud on the insured and

14

the insurer have significance in the case because

they were the means by which the ultimate objec-

tive of the conspiracy—the Government guarantee

of the premiums—was attained. But at. this

juncture of the litigation it is unnecessary to

dwell on anything more than the plain fraud

which the defendants perpetrated on the Vet-

erans’ Administration. We turn to a brief

seriatim consideration of the contentions which

petitioners urge.

1. The Soldiers’ and Sailors’ Civil Relief Act

requires as a condition to eligibility for Govern-

ment guarantee of premiums that the contract of

insurance shall have been made more than thirty

days before the insured went on active military

duty. To satisfy this condition, the conspirators

caused the insurance to be back-dated. Thus,

for example, in the case of the witness Betz, the

testimony showed that he signed the application

form on May 26 (R. 322) or May 28 (R. 320)

and entered on active military duty on June 1

(R. 319). The application form requested that

the policy be issued as of May 1, 1943 (R. 768-

769) and the policy was so issued (see R. 380).

The Veterans’ Administration was thus informed

that the policy was more than thirty days old

when Betz entered active military service.

Petitioners point to evidence showing that it

was the accepted practice of the insurer to date

its policies as of either the first day of the month

in which the application was made or of the fol-

i

15

lowing month (R. 100, 123, 126, 167) and: they

urge (Pet. 11-14) that there was nothing wrong

in what they did. Indeed, they suggest that the

question whether the date on the application or

the date on the policy controls is a certiorari

question.

It seems plain to us that the thirty-day pro-

vision in the statute was designed specifically for

the purpose of eliminating from the guarantee

protection afforded by the act, policies which were

sold, as here, immediately preceding the insured’s

entry into active military service. Otherwise the

thirty-day limitation has little, if any, meaning.

But there is no oecasion in these cases to reach

that question. For the jury was instructed, at

petitioners’ request (R. 732-733), that the effec-

tive date of the insurance for guarantee purposes

was the date on the face of the policy (R. 753-

754). By this instruction the trial judge, in

effect, eliminated from the ease the issue whether

the policies were less than thirty days old, for in

each case the date on the policy was more than

thirty days before the insured went on active

military duty. In these circumstances, there can

be no issue in this Court as to the propriety of

dating back the policies or as to which date is

controlling. Petitioners prevailed on this issue

of law in the district court arid there is thus noth-

ing of the issue isft for appellate review.

2. For the same reason, petitioners’ second con-

tention (Pet. 14-15) is without merit. Peti-

16

tioners’ argument concerning the meaning of

‘“‘date’’ is beside the point. For the meaning for

which they contend was the one which the district

court adopted. Nothing in the opinion of the

circuit court of appeals suggests that, in reviewing

the trial proceedings, the appellate court rejected

the instruction which petitioners asked fur and

got in the trial court (see infra, pp. 24-36).

3. Petitioners’ reliance (Pet. 15-16) on Terry

v. United States, 131 F, 2d 40 (C. C. A. 8), as

being in conflict with the decision below is mis-

placed. That was a case in which false state-

ments were made to a local lending institution,

which later obtained credit insurance from the

Federal Housing Administration, and the court

held that the defendants’ false statements did not

constitute a violation of the false claims statute.

But the court carefully distinguished cases like |

United States v. Gilliland, 312 U. S. 86, where, as

the court said (131 F. 2d at 45), ‘‘the defendants

were shown to have knowingly made false state-

ments in reports to an agency of the government

in respect to a matter within its jurisdiction and

the point involved in this case was not involved.”’

' In these cases the defendants caused false re-

ports to be made to the Veterans’ Administra-

tion. They were not prosecuted for making false

statements to the insurer or to any other outsider.

The evidence summarized in the Statement shows,

and petitioners do not deny, that the defendants

caused the applicants to sign the Veterans’ Ad-

a ae = '

PPE OPEN I a NEY CARE OREN IR ETE IEE A E

nena ecerene anaes ate

17

ministration Forms 380 in blank. The defend-

ants subsequently filled them in falsely stating

that. the insured had paid the last premium on

the policy, that the policy had been delivered to

the insured’s beneficiary, and that the information

was submitted by the insured who signed the state-

ment at a given time und place. Not only did

the defendants give false answers on the Form

380, but it was they who forwarded the forms to

the Veterans’ Administration. And thus in a

real sense they made false reports to the Veterans’

Administration, which, it is undisputed, had juris-

diction to administer the Soldiers’ and Sailors’

Civil Relief Act. The basic difficulty with peti-

tioners’ argument in this respect is that they have

conveniently overlooked Form 380, without which

there would not have been guaranteed premiums.

In our view, submission of the Forms 380 to the

Veterans’ Administration was a vital step in the

successful execution of the conspirators’ plan.

If the questions in the forms had been truthfully

answered by the insured persons, there can be

little question that the guarantees would not have

been forthcoming.

4. In urging (Pet. 16-19) that ‘‘Any misrepre-

sentations or false claims made to the govern-

ment’? were made by the insurer in the Forms

381 which the insurer filed with the Veterans’

Administration, and not by them, petitioners

again conveniently disregard the Forms 380 which

contained false information and which they filed

ROE ad

eS OETA A

18

with the Veterans’ Administration, although the

forms appeared to have been filed by the insured

persons. Far from having been convicted for

someone else’s wrongdoing, petitioners were con-

victed because of what they themselves did.

5. The contention (Pet. 19-26) that petitioners’

only fraud was against the insured persons and

the insurer and that evidence of this fraud was

the basis for their convictions disregards the fact

that there would have been no incentive for the

frauds on the individuals and the insurer except

as a means of obtaining the issuance of insurance

policies, the premiums of which would be guar-

anteed by the Government. Without the guar-

antees, petitioners obviously would not have

‘*sold’’ large insurance policies to young men who

were entering active military duty, and they cer-

tainly would not have paid the initial premiums

on the policies, as they did. These were but pre-

liminary steps to the obtaining of Government

guarantees for the premiums and it was the fraud

involved in obtaining these guarantees for which

petitioners were convicted. Instead of showing

fraud against individuals only, the evidence con-

vincingly demonstrated that these were incidental

frauds and that the success of the conspiracy de-

pended upon the final step, the securing of the

guarantees by deceit.

6. The fundamental assumption for petitioners’

sixth contention (Pet. 26-29) that the defendants

did not make any misrepresentations to the Gov-

ernment is, as we have shown, unsound. Viewing

the answers contained on the Forms 380 which

petitioners submitted to the Veterans’ Acminis-

tration ‘‘in the light of the facts existing when

said document was brought to the attention of

the Veterans Administration for official action’’

(Pet. 28), it is plain that the answers stating that

the insured had paid the last premium on the

poliey was untrue, as were the answers stating

that each policy was in the possession of the

person named as beneficiary. And, finally, the

defendants made it appear that the persons who

signed the forms undertook the obligations con-

tained in it (see, e. g., R. 922). But the evidence

shows that the young men merely signed blank

forms, not knowing their contents, and that they

had no intention of undertaking to reimburse the

Government for any premiums which it was re-

quired to pay. It is evident that the Veterans’

Administration was misled, by the Forms 380

which were submitted, into guaranteeing the pre-

miums on the policies, and it is equally evident

that the defendants did the misleading.

7. At the close of the evidence petitioners sub-

mitted to the court 28 requested instructions. The

trial judge went over each with counsel and indi-

eated which he would give and which would be

refused (see R. 727-741). The court declined

Defendants’ Requested Instruction No. 21 (R.

735), which read:

Ne er

20

If you believe from the evidence, or if

you entertain a reasonable doubt upon the

question that the defendants acted in good

faith in the honest belief that they were

doing what they had a legal right to do,

you must acquit such defendants, even

though the effect of what the defendants

actually did was illegal.

Instead the court instructed the jury that to

convict they must find that the defendants had a

corrupt intent to defraud the United aioe The

court stated (R. 752) :

Now, intent, ladies and gentlemen, is an

essential element of this crime, and you

must find that any defendant had the

necessary intent to violate the law. In

order to find a defendant, or any of them,

guilty, the jury must find beyond a reason-

able doubt that they conspired with intent

to defraud and with knowledge of the un-

lawful nature of their acts and intended to

become a party to such conspiracy.

Now, intent, ladies and gentlemen, is

something that you cannot give any direct

evidence about, so you may judge whether

a man has an intent to do a certain act by

his conduct and by the necessary conse-

quences that flow from his acts in dealing

with his fellow men. If you believe that

any one of these defendants intended to do

what he did with the intent to defraud the

Government of the United States, then that

is sufficient to prove that he intended that

act and would justify a verdict of guilty

at your hands.

a lehieeeetaninen ~— iconlaan ceeaiaiiadaiaed —- —e Se ee

21

And a few moments later the court reiterated

the instructions on intent (R. 754), as follows:

Intent is an essential element of the crime

charged by the indictment. In order for

the jury to find the defendants or any of

them guilty, the jury must find that. the

defendants conspired with an intent to de-

fraud and with knowledge that the claims

or statements, if any, presented to the

United States were false, fictitious or

fraudulent. If the jury finds that the

defendants had no intent to defraud the

United States and did not conspire to know-

ingly and wilfully present a false claim or

statement to the United States, then the

defendants are entitled to a verdict of

acquittal.

One of the essential elements of this case,

as I have told you, is intent. The charge is

that the defendants knowingly and wilfully

conspired with each other to do the acts com-

plained of, but before there can be any con-

viction of any defendant in this case, you

must find from the evidence beyond a

reasonable doubt that such defendant or

defendants had a corrupt intent and acted

with full knowledge that what they did was

done for the purpose of defrauding the

United States.

At the close of the instructions, the court invited

any further requested instructions or exceptions

(R. 756). Petitioners noted some exceptions (R.

756-757) and the Government then suggested

certain additional instructions (R. 757-758), in-

——————————— -

22

eluding an instruction ‘‘that good faith and honest

belief is a defense, but they have to. find that

from all the evidence in the case.’’ Petitioners’

counsel raised additional matters in regard to the

instruction? but offered no comment on the in-

struction¢*on good faith which the Government

suggested (see R. 758-759).

The court then further instructed the jury and

included the following statement (R. 759-760) :

Also, good faith and honest belief is a

defense, if you so find, after you have con-

sidered all the evidence. The charge or the

violation that the defendants are charged

with is found in the indictment, which you

will have, and you must confine yourselves

to a consideration of those charges and

nothing else, because the charge is a con-

spiracy to attempt to defraud the United

States,

-Immediately upon the conclusion of the in-

struction on good faith, the trial judge invited

exceptions and petitioners’ counsel excepted to the

instruction on good faith in the following terms

(R. 760):

[The Court.}] Are there any other ex-

ceptions ?

Mr. Rosinson. To the last one that you

mentioned, where you state again that the

charge was an intent to defraud the United

States, without restricting or limiting it

to the material facts contained in the

indictment.

x.

Petitioners now contend that the: instruction

was erroneous on another ground, ‘‘in that

the burden of proof is shifted to the accused”

(Pet. 30). -But: this ground was not asserted in

the trial court. and, as the court below noted

(R. 1050), it therefore is not now open to peti-

tioners. Rule 30 of the Federal Rules of Criminal

Procedure specifically: provides that— |

* * * No party may assign as error any

portion of the charge or omission therefrom

unless he objects thereto before the jury

retires to consider its verdict, stating

distinctly the matter to which he objects

and the grounds of his objection.

As the recital the proceedings shows, peti-

tioners had an op ity to object to the terms

of the instruction both when it was proposed by

the Government and when it was given by the

trial judge. In both instances they raised other

objections, but not the one on which they now

rely.

It is no answer to suggest, as petitioners do,

that they had made their position known to the

court three days earlier when they tendered their

Requested Instruction No. 21. For in the light

of the iteration and reiteration of the instructions

on corrupt intent and the giving of the instruction

on good faith which the Government requested,

it was reasonable for the trial judge to assume

that petitioners were satisfied with the instruc-

tions as given. This is particularly so, because

petitioners were given ample opportunity to

except to the instruction and they did not do so

on the ground on which they now rely. A de-

fendant may not excuse his acquiescence in an

instruction by showing that at an earlier stage

in the proceedings he had taken a different

position. Particularly where the objection is as

technical as that which petitioners now urge, it

should have been distinctly stated to the trial

judge, as Rule 30 requires.

In view of the: overwhelming strength of the

evidence of guilt and in view of the court’s

emphasis on the element of corrupt intent as an

ingredient of the offense, it is difficult to believe

that the instruction to which petitioners now

object played any substantial part in tipping the

scales against them.

8. In their final contentions (Pet. 31-32) peti-

tioners return to the question of back-dating the

insurance policies. As has been shown, supra,

p. 15, the trial court instructed the jury that

the date on the policy controlled and that peti-

tioners’ practice in this respect was unobjection-

able. Petitioners now urge that the circuit court

of appeals reached a contrary conclusion and

that their convictions were affirmed on a different

theory of the case than was submitted to the

jury. Reference to the opinion of the court

below demonstrates that petitioners are mistaken.

After summarizing the evidence (R. 1043-

1046) and setting forth the relevant statutory

provisions (R. 1041-1043, 1046), the circuit court

aa

Bae

of appeals characterized the conspiracy as fol-

lows (R. 1047):

* #* *° The scheme apparently designed,

eare involved from the very outset much

more than merely dating policies back to

the first day of the current month in which

the applications were submitted and the

paying of the first premium on them. It

was saturated with falsity and conceal-

ment. The prospects were told in sub-

stance that they could obtain the insurance

coverage without cost or liability. The

obligation to reimburse the government for

premiums paid was carefully concealed.

The applications for insuranee were held

until the strategic time arrived and were

then filled out. The reports of medical

examination were faked. Certain material

information given in the applications for

benefits under the Act was misleading and

deceptive. And as contemplated by the de-

fendants, the reports of the insurance com-

pany contained statements or representa-

tions similar to the misleading and de-

ceptive representations contained in the

applications for benefits under the Act in

respect of the time the insurance had been

in effect and a premium paid thereon. All

of that was done for the purpose of bring-

ing about the guarantee of the premiums,

after which the defendants would reap

their financial reward. An agreement to

enter into such a concert of action for that

ultimate” end attended by one or more

overt acts by one or more of the ‘parties

-eonstitutes a conspiracy to defraud the

United. States, in violation of section 37,

supra. |

In the light of these words, it ean hardly be

‘seriously contended that petitioners’ convictions

were affirmed because the circuit court of appeals —

thought it was wrong for them to date back the

policies which they sold. At no place in the

opinion did the appellate court express dis-

approval of the theory of the case in the trial

court. Indeed, it reiterated the theory of the

trial judge (cf. R. 490-491, 726-727 with R. 1046-

1047). The theory of the case has been the same

in the district court and in the circuit court of .

a peals.

? CONCLUSION

On the record, the guilt of petitioners is con-

vinecingly established. The contentions which

petitioners urge fail to demonstrate in any respect

that they were not fairly tried and convicted.

We therefore respectfully submit that the petition

for writs of certiorari should be denied.

Pure B. PERLMAN,

Solicitor General.

T. VINCENT QUINN,

Assistant Attorney Generai.

Rosert S. ERDAHL,

Irvine 8. SHAPIRO,

Attorneys.

JaNuARY 1948.

—

APPENDIX

as amended, 56 Stat. 773 (50 U.S. C. App., Supp.

V, 540-548) provides in pertinent part: ~

(a) The term ‘‘policy” shall include any

contract of life insurance or policy on a

life, endowment, or term plan, including .

any. Deere we nature of life insurance

arising out of membership in any fraternal

or beneficial association, which does not

provide for the payment of any sum less

than the face value thereof or for the pay-

ment of an additional amount as ums

if the insured in the mili! serv-

ice of the United States as defined in sec-

tion 101 of article I of this Act or which

does not contain any limitation or restric-

tion upon coverage relating to engagement

in or pursuit of certain types of activities

which a person might be required to engage

in by virtue of his being in such military

service, and (1) which is in force on a

premium-paying basis at the time of appli-

cation for benefits hereunder, and (2)

which was made and a premium paid

thereon before the date of enactment of

the Soldiers’ and Sailors’ Civil Relief Act

Amendments of 1942 or not less than thirty

days before the date the insured entered

into the military service. The provisions

of this Act shall not be applicable to poli-

cies or contracts of life insurance issued

under the War Risk Insurance Act, as \

amended, the World War Veterans’ Act, ~

- as amended, or the National Service Life

Insurance Act of 1940, as amended. * * *

Sec. 401. The benefits and privileges of

this article shall apply to any imsured,

when such insured, or a person designated

by him, or, in case the insured is outside

(27)

the: continental United States (excluding

Alaska and the Panama Canal Zone), a

beneficiary, shall: make written application

for protection under this article, unless the

Administrator of Veterans’ Affairs in pass-

ing upon such application as provided in

this article shall find that the ay Se, not

entitled to protection hereunder. e Vet-

erans’ Administration shall give notice to

the military and naval authorities of the

provisions of this article, and shall include

in such notice an explanation of such pro-

visions for the information of those desir-

ing to make application for the benefits

thereof. The original of such application

shall be sent by the insured to the insurer,

and a copy thereof to the Veterans’ Admin-

istration. The total amount of insurance

on the life of one insured under policies

protected by the provisions of this article

shall not exceed $10,000. If an insured

makes application for protection of policies

on his life totaling insurance in excess of

$10,000, the Administrator is authorized to

have the amount of insuratice divided into

two or more policies so that the protection

of this article may be extended to include

policies for a total amount of insurance not

to exceed $10,000, and a policy which

affords the best security to the Government

shall be given preference.

Src. 402. Any writing signed by the in-

sured and identifying the policy and the

insurer, and agreeing that his rights under

the policy are subject to and modified by

the provisions of this article, shall be suffi-

cient as an application for the benefits of

this article, but the Veterans’ Administra-

tion may require the insured and insurer

to execute such other forms as may be

deemed advisable. - Upon receipt of the

application of the insured the insurer shall

pe se rence eydn. array gh cm

wno- é ‘ £5 ;

under this article and the insurer shall be

deemed to have agreed to such modification

of the policy as may be required to give this

article full force and effect with respect to

such policy. :

Src. 403. The Administrator of Veterans’

Affairs shall find whether the policy is en-

titled to protection under this article and -

st ee” hae" ply feta te

su ; po

Administrator of Veterans’ Affairs to be

acre ealegtonh to date Ok aan

not, subsequen of applica

and jr the period of military service

of the insured or during two years after the

expiration of such service, lapse or other-

wise terminate or be forfeited for the non-

payment of a premium ing due and

re able, or the nonpayment of any in-

ebtedness or interest.

* * * * *

Src. 407. The Administrator of Veterans’

Affairs is hereby authorized and directed

to provide by regulations for such rules of

procedure and forms as he may deem ad-

visable in ing out the provisions of

this article. The findings of fact and con-

clusions of law made by the Administrator

of Veterans’ Affairs in administering the

provisions of this article shall be final, and

shall not be subject to review by any other

official or agency of the Government. The

Administrator of Veterans’ Affairs shall

report annually to the Congress oa the ad-

ministration of this article.

2. Section 35 (A) of the Criminal Code (18 U.

8. C. 80) provides:

30

Whoever shall make or cause to. be made ~

or present or-cause to be presented, for —

payment or approval, to or by any perso

or officer in the civil, military, or na

service of the United States, or any depart-

ment thereof, or any corporation in which —

the United States of America is a stock- —

holder, any claim upon or against the ~

Government of the United States, or any —

department or officer thereof, or any cor- —

poration in which the United States of ~

America is a stockholder, knowing such ~

claim to be false, fictitious, or fraudulent; ~

or whoever shall knowingly and willfully ~

falsify or conceal or cover up by any trick, ~

scheme, or device a material fact, or make ~

or cause to be made any false or fraudulent ~

statements or representations, or make or

use or cause to be made or used any false ~

bill, receipt, voucher, roll, account, claim, ~

certificate, affidavit, or a knowing —

the same to contain any fraudulent or fic- —

titious statement or entry in any matter ~

within the jurisdiction of any department —

or agency of the United States or of any ©

corporation in which the United States of ~

America is a stockholder, shall be tined not ~

more than $10,000 or imprisoned not more —“™%

than ten years, or both. s

3. Section 37 of the Criminal Code (18 U. S. C.

88) provides:

If two or more persons conspire either to

commit any offense against the United

States, or to defraud the United States in

any manner or for any purpose, and one or

more of such parties do any act to effect the

object of the conspiracy, each of the parties

to such conspiracy shall be fined not more

than $10,000, or imprisoned not more than

two years, or both.

U. S. GOVERNMENT PRINTING OFFICE: 1948