THE GRAND JURY CHARGES:
COUNT ONE
I. INTRODUCTION
At all times material to this Indictment:
- Defendant SUN-DIAMOND GROWERS OF CALIFORNIA (hereafter defendant SUN-DIAMOND) was a
California agricultural cooperative corporation. Defendant SUN-DIAMOND's principal offices
were in Pleasanton, California.
- Defendant SUN-DIAMOND was owned by five member cooperatives which, in turn, were owned
by a total of approximately 4,500 growers. The five member cooperatives, who are not named
as defendants in this indictment, were:
- Sun-Maid Growers of California;
- Diamond Walnut Growers, Inc.;
- Sunsweet Growers, Inc.;
- Valley Fig Growers; and
- Hazelnut Growers of Oregon.
- Defendant SUN-DIAMOND and its member cooperatives grew, processed, packaged, marketed
and sold, among other products, raisins, walnuts, prunes, figs, and hazelnuts. Each member
cooperative was the largest producer of commodities in its respective industry.
- Defendant SUN-DIAMOND assisted the member cooperatives primarily by handling their
marketing and dealing with federal agencies in Washington, D.C., such as the United States
Department of Agriculture. Defendant SUN-DIAMOND pursued matters of importance to
SUN-DIAMOND with the Department of Agriculture and Secretary of Agriculture Alphonso
Michael Espy (hereafter Secretary of Agriculture Michael Espy), not named as a defendant
herein.
- SUN-DIAMOND Senior Corporate Officer X, whose identity is known to the Grand Jury, but
is not named as a defendant in this Indictment, was, on behalf of SUN-DIAMOND and the
member cooperatives, in charge of and responsible for, among other things:
- Dealing with the Secretary of Agriculture and decision makers at the Department of
Agriculture; and
- Directing SUN-DIAMOND's federal government lobbying activities and representatives,
which included James H. Lake, not named as a defendant herein;
- The United States Department of Agriculture was a department of the United States
Government. The duties of the Department of Agriculture were and are, among other things,
to improve and promote agricultural development and production in the United States and
the promotion of United States agricultural products in other countries. The Secretary of
Agriculture was and is in charge of the Department of Agriculture.
- In or about December 1992, President-Elect William Jefferson Clinton advised Michael
Espy that he would nominate him to be the Secretary of Agriculture. From that time
forward, Michael Espy became subject to the provisions of federal law which, in part and
among other things, made it unlawful for companies such as defendant SUN-DIAMOND to give
things of value to Michael Espy for and because of official acts performed or to be
performed by him.
- On or about January 14, 1993, the United States Senate Committee on Agriculture,
Nutrition and Forestry considered the nomination of Michael Espy to be Secretary of
Agriculture. Michael Espy was confirmed by the United States Senate on January 21, 1993.
Michael Espy served as the Secretary of Agriculture from January 22, 1993 until December
31, 1994.
II. SUN-DIAMOND ISSUES INVOLVING THE
DEPARTMENT OF AGRICULTURE
- In 1993 and 1994, defendant SUN-DIAMOND and its member cooperatives had questions,
matters, and issues pending with the Department of Agriculture and Secretary of
Agriculture Michael Espy. In part these included:
A. MARKET
PROMOTION PROGRAM
- During 1993 and 1994, the Department of Agriculture administered a grant program
designed to increase export sales of certain U.S. agricultural commodities abroad,
including prunes, raisins, and walnuts. This program was and is known as the Market
Promotion Program ("MPP").
- In part and among other things, under the MPP, the Department of Agriculture, acting
through the Secretary of Agriculture, was authorized to award government funds to trade
organizations, if the Secretary of Agriculture determined that such organizations would
significantly contribute to the sale of United States farm commodities in foreign
countries.
- To receive money to market their commodities in foreign countries, trade organizations
submitted marketing plan applications to the Department of Agriculture. By law, the
Secretary of Agriculture had to approve the award of MPP money to each trade organization.
The trade organizations would in turn award money to companies, like the member
cooperatives of defendant SUN-DIAMOND, to pay for part of their marketing campaigns in
foreign countries.
- Since the inception of the MPP program, the major SUN-DIAMOND member cooperatives
applied for and obtained MPP money from trade organizations in which they participated.
Each of the defendant SUN-DIAMOND member cooperatives was the largest member of its
respective trade organization.
1994 MPP Allocations
- The ability and capability to sell raisins, prunes, and walnuts abroad was of
substantial importance to defendant SUN-DIAMOND member cooperatives.
- During May 1994, the Department of Agriculture allocated $2,180,000 to the California
Prune Board, the trade organization that administered MPP funds for prunes, $3,520,000 to
the Raisin Administrative Committee, the trade organization that administered MPP funds
for raisins, and $2,890,000 to the California Walnut Commission, the trade organization
that administered MPP funds for walnuts. A portion of MPP funds to each trade organization
was dedicated to the sale of brand name commodities such as Sun-Maid raisins, or Sunsweet
prunes, and the remainder was dedicated to advertising such commodities generally.
- During 1994, the California Walnut Commission dedicated $45,941 to the marketing of
brand name walnuts. Diamond Walnut Growers received all such brand name dedicated funds,
or 100 percent. In 1994, the California Prune Board dedicated $2,362,685 of its MPP funds
to the marketing of brand name prune products and Sunsweet Growers received $1,232,000 of
such funds, or 52 percent. The Raisin Administrative Committee dedicated $445,750 of its
MPP funds to brand name marketing and Sun-Maid Growers received $165,000 of such funds, or
32 percent. The remainder of all such MPP funds was spent on advertising raisins, prunes,
and walnuts generally in selected foreign countries, which also benefitted Sun-Maid
Growers, Sunsweet Growers, and Diamond Walnut Growers as they sold their products in such
countries.
- Obtaining MPP funds for fiscal year 1994 was a matter of importance to SUN-DIAMOND and
its major member cooperatives, Diamond Walnut Growers, Sunsweet Growers, and Sun-Maid
Growers of California.
- In or about April and May 1994, there were questions and matters pending before the
Department of Agriculture concerning whether California raisin producers, including
Sun-Maid Growers of California, would be able to receive MPP funds because the raisin
trade organization to which they belonged and which had applied to USDA for MPP funds
would not exist after July 31, 1994.
SUN-DIAMOND Cooperatives and
the
Definition of Small-Sized Entities
- Beginning in or about August 1993, by law, the Department of Agriculture was required to
develop regulations which gave small-sized entities preference in obtaining certain MPP
funds. The Department of Agriculture was deciding whether to include cooperatives in the
definition of small-sized entity. If the Department of Agriculture did not consider
cooperatives to be small-sized entities, this would result in some defendant SUN-DIAMOND
member cooperatives receiving less MPP money.
- Defendant SUN-DIAMOND wanted Secretary of Agriculture Michael Espy to: (a) cause the
Department of Agriculture to promulgate MPP regulations that would allow defendant
SUN-DIAMOND member cooperatives to receive the preferences provided for small sized
entities, and (b) continue to study the issue with a view to giving cooperatives the
preferences due small sized entities.
B. METHYL BROMIDE
- Methyl Bromide was a chemical that was used to kill pests and other insects when
planting orchards and fields. It was also used to kill pests after a commodity was
harvested. Certain of defendant SUN-DIAMOND's member cooperatives used methyl bromide for,
among other uses, post-harvest fumigation of walnuts, prunes, and figs. Methyl bromide was
a low cost, effective pesticide.
- In 1992, the Environmental Protection Agency had announced plans to promulgate a rule
which would phase out and ultimately bar the use of methyl bromide in the United States.
This proposed rule included a prohibition of the use of methyl bromide as a fumigant on
commodities that were exported by defendant SUN-DIAMOND's member cooperatives to other
countries.
- In 1993 and 1994, defendant SUN-DIAMOND and particularly Diamond Walnut, were concerned
that the loss of methyl bromide and lack of a viable alternative for methyl bromide would
hurt their ability, among other things, to sell their products. Defendant SUN-DIAMOND
sought the assistance of the Department of Agriculture, in part and among other things, to
persuade the Environmental Protection Agency to delay promulgating the rule to phase out
and eliminate the use of methyl bromide and to mitigate the adverse effects of any such
rule, when such rule was formally proposed on or about March 18, 1993.
- Defendant SUN-DIAMOND also sought to have the Department of Agriculture increase its
funding for research for alternatives to methyl bromide in the event that use of methyl
bromide were restricted or prohibited.
III. THINGS OF VALUE GIVEN
TO SECRETARY OF AGRICULTURE
MICHAEL ESPY BY DEFENDANT SUN-DIAMOND
- From on or about January 5, 1993, through on or about March 11, 1994, defendant
SUN-DIAMOND, acting through its Senior Corporate Officer X, spent or caused defendant
SUN-DIAMOND to spend approximately $14,287 of SUN-DIAMOND corporate funds in the course of
entertaining and providing things of value to Secretary of Agriculture Michael Espy and
the Secretary's girlfriend, not named as a defendant herein. Of the total amount spent by
defendant SUN-DIAMOND's Senior Corporate Officer X, approximately $5,913 was spent
directly on Secretary of Agriculture Michael Espy. The remaining balance of defendant
SUN-DIAMOND money, approximately $8,374, was largely used by Senior Corporate Officer X to
pay for the expenses of himself, Secretary of Agriculture Michael Espy's girlfriend, and
Senior Corporate Officer X's own girlfriend when Senior Corporate Officer X was
entertaining Secretary of Agriculture Michael Espy.
- Defendant SUN-DIAMOND's Senior Corporate Officer X used a personal credit card or caused
defendant SUN-DIAMOND to pay the seller directly to purchase the things of value for
Secretary of Agriculture Michael Espy that are referenced in this Count of the Indictment.
Senior Corporate Officer X submitted reimbursement requests to SUN-DIAMOND for the cost of
the things of value that he provided to Secretary of Agriculture Michael Espy.
- Defendant SUN-DIAMOND reimbursed Senior Corporate Officer X for all of the money he
spent for things of value provided to Secretary of Agriculture Michael Espy in this Count
of the Indictment in accordance with defendant SUN-DIAMOND's Policy Statement Number P-3,
Expense Control and Reporting, which stated in pertinent part:
"Entertainment expenses which are reimbursed are those ordinary and necessary
costs that employees are required to incur for hospitality extended to individuals in
sales promotion and in establishing or maintaining business relationships. These
expenditures associated with the active conduct of business are reimbursed only if the
entertainment precedes or follows a bona fide business discussion."
A. TICKETS, MEALS AND LIMOUSINES FOR THE
UNITED STATES OPEN TENNIS TOURNAMENT
- On or about September 10, 1993, SUN-DIAMOND Senior Corporate Officer X, Secretary of
Agriculture Michael Espy, and their girlfriends traveled from the District of Columbia to
New York City to attend the U.S. Open Tennis Tournament.
- On or about September 11 and September 12, 1993, defendant SUN-DIAMOND, acting through
Senior Corporate Officer X, paid approximately $9,183 for tickets, limousines, and meals
for Secretary of Agriculture Michael Espy and the Secretary's girlfriend, and for Senior
Corporate Officer X and his girlfriend to attend two tennis matches at the U.S. Open
Tennis Tournament in Flushing Meadows, New York. Defendant SUN-DIAMOND's Senior Official X
spent approximately $2,295 of the $9,183 for tournament tickets, meals, and limousines
provided directly to Secretary of Agriculture Michael Espy.
B.
LUGGAGE
- On or about January 20, 1993, defendant SUN-DIAMOND, acting through Senior Corporate
Officer X, purchased and gave to Secretary of Agriculture Michael Espy five pieces of
Hartmann luggage at a total cost of $2,427 and gave that luggage to Secretary of
Agriculture Michael Espy.
C. MEALS AT RESTAURANTS
- From on or about January 5, 1993, through on or about March 11, 1994, defendant
SUN-DIAMOND, acting through Senior Corporate Officer X, spent approximately $2,152 to
provide meals and entertainment to Secretary of Agriculture Michael Espy and others at
restaurants and at a barbecue. The amount of money defendant SUN-DIAMOND spent for food
directly served to Secretary of Agriculture Michael Espy was approximately $665.
D. OTHER THINGS OF VALUE
- On or about October 28, 1993, November 9, 1993, and January 17, 1994, defendant
SUN-DIAMOND, acting through Senior Corporate Officer X, spent or caused defendant
SUN-DIAMOND to spend approximately $524 to buy and provide a framed print, packing for the
print, and a crystal bowl for Secretary of Agriculture Michael Espy.
- From on or about January 5, 1993, through on or about March 11, 1994, in the District of
Columbia and elsewhere, defendant SUN-DIAMOND, acting through Senior Corporate Officer X,
did knowingly, directly and indirectly, give, offer and promise things of value as set
forth above, to a public official, namely: Alphonso Michael Espy, the Secretary of
Agriculture, and to Alphonso Michael Espy, a person selected to be a public official,
namely: the Secretary of Agriculture, for and because of official acts performed and to be
performed by Alphonso Michael Espy, otherwise than as provided by law for the proper
discharge of official duty.
(In violation of Title 18, United States Code, § 201(c)(1)(A)
and Title 18, United States Code, § 2)
THE GRAND JURY FURTHER CHARGES:
COUNT TWO
- Paragraphs 1 through 24 of Count One of this Indictment are realleged and incorporated
by reference as though set forth in full.
- The International Nut Council was and is composed of growers, handlers, brokers, agents,
exporters and others, including Diamond Walnut Growers of California, who work to expand
the worldwide consumption of tree nuts. It was important to the International Nut Council
to have Secretary of Agriculture Michael Espy speak to its members at their IX World Tree
Nut Congress which was to be held May 22-24, 1993 in Athens, Greece.
- Diamond Walnut Growers of California, a member cooperative of the defendant SUN-DIAMOND,
was a member of the International Nut Council. The President of Diamond Walnut was a
member of the International Nut Council Executive Committee. Diamond Walnut wanted to
increase its export of walnuts to other countries and, in part, used the International Nut
Council to achieve this objective.
- In or about January 1993, Officer Y of the International Nut Council, whose identity is
known to the Grand Jury, but is not a defendant herein, talked to defendant SUN-DIAMOND's
Senior Corporate Officer X to have Senior Corporate Officer X help arrange for Secretary
of Agriculture Michael Espy to attend and speak at the Athens World Tree Nut Congress.
- As a result of these discussions, on or about February 9, 1993, the International Nut
Council, acting through Senior Corporate Officer X, invited Secretary of Agriculture
Michael Espy to speak at the IX World Nut Congress in Athens.
- On or about April 7, 1993, Secretary of Agriculture Michael Espy wrote to Officer Y of
the International Nut Council, in care of defendant SUN-DIAMOND's Senior Corporate Officer
X, to advise that Senior Corporate Officer X would be involved in working out the details
of Secretary Espy's appearance at the Athens Congress.
- In or about April 1993, in one or more telephone discussions regarding whether Secretary
of Agriculture Michael Espy would attend the World Nut Congress, defendant SUN-DIAMOND's
Senior Corporate Officer X suggested to Officer Y of the International Nut Council that
the Nut Council provide a first class airplane ticket costing about $7,000, so that
Secretary of Agriculture Michael Espy could take his girlfriend to Athens. Officer Y of
the International Nut Council agreed to pay the cost of a business class airplane ticket,
approximately $3,100, for Secretary of Agriculture Michael Espy's girlfriend.
- On or about May 13, 1993, in the District of Columbia, SUN-DIAMOND Senior Corporate
Officer X gave Secretary of Agriculture Michael Espy's girlfriend approximately $3,100 in
cash to pay for the cost of her airplane ticket to Athens.
- On May 21, 1993 Secretary of Agriculture Michael Espy and his girlfriend flew to Athens,
where they attended part of the IX World Tree Nut Congress. Defendant SUN-DIAMOND Senior
Corporate Officer X and his girlfriend were also at the Congress as well as a delegation
from Diamond Walnut Growers.
- During this time, defendant SUN-DIAMOND's Senior Corporate Officer X entertained
Secretary of Agriculture Michael Espy and Secretary Espy's girlfriend at restaurants in
Athens. Secretary Espy and his girlfriend spent May 25, 1993 in Rome and returned to the
District of Columbia, on May 26, 1993.
- On or about July 30, 1993, Officer Y of the International Nut Council caused a wire
transfer in the amount of $3,140 to be sent from the International Nut Council's bank in
Spain to defendant SUN-DIAMOND's Senior Corporate Officer X's bank account in California,
as reimbursement to Senior Corporate Officer X for the cash he had given to Secretary
Espy's girlfriend to pay for her airplane ticket.
- In or about May 1993, in the District of Columbia and elsewhere, defendant SUN-DIAMOND,
acting through its Senior Corporate Officer X, did knowingly, directly and indirectly,
give, offer and promise a thing of value, namely: approximately $3,100 and the benefit
thereof, to a public official, namely: Alphonso Michael Espy, the Secretary of
Agriculture, for and because of official acts performed and to be performed by Alphonso
Michael Espy, otherwise than as provided by law for the proper discharge of official duty.
(In violation of Title 18, United States Code, §201(c)(1)(A)
and Title 18, United State Code, §2)
THE GRAND JURY FURTHER CHARGES:
COUNT THREE
I. INTRODUCTION
- Paragraphs 1 through 8 of Count One are realleged and incorporated by reference herein
as though set forth in full.
- At all times relevant to Count Three of the Indictment:
II.
ROBINSON LAKE SAWYER MILLER
- James H. Lake, not named as a defendant in this Indictment, was a founding partner of
Robinson, Lake, Lerer & Montgomery, Inc., d/b/a "Robinson Lake Sawyer
Miller" (hereafter, "RLSM").
- RLSM's principal place of business was in New York, New York.
- In addition to its New York operation, RLSM conducted business through its District of
Columbia office. This Count concerns the activities of the District of Columbia office of
RLSM.
- James H. Lake was in charge of the District of Columbia office and held the position of
chairman of the board of directors of Robinson, Lake, Lerer & Montgomery, Inc.
- RLSM was owned and controlled by, and was a wholly-owned subsidiary of Bozell Worldwide,
Inc. (hereafter "Bozell, Inc."), which in turn was and is owned and controlled
by Bozell, Jacobs, Kenyon & Eckhardt, Inc., a Delaware corporation, with its principal
place of business in New York, New York.
- A principal part of RLSM's business was lobbying and public
- Defendant SUN-DIAMOND was one of the most important and oldest agricultural clients of
RLSM.
- In part and among other things, defendant SUN-DIAMOND's Senior Corporate Officer X
supervised defendant SUN-DIAMOND's relationship with RLSM and the activities of James H.
Lake. Senior Corporate Officer X used an office at RLSM, when he was conducting his
business for defendant SUN-DIAMOND in the District of Columbia.
- RLSM handled, in part, defendant SUN-DIAMOND's public relations and lobbying activities,
including representing defendant SUN-DIAMOND's interests before the Department of
Agriculture. Defendant SUN-DIAMOND paid RLSM a $20,000 per month retainer, plus expenses.
III. THE HENRY ESPY CAMPAIGN
- The Federal Election Commission (hereinafter "FEC") was the agency of the
United States Government entrusted with responsibility for enforcement of the reporting
requirements of the Federal Election Campaign Act, 2 U.S.C.§§431-455 (hereinafter
"FECA"), and for the detection, investigation, and institution of enforcement
actions arising from violations of FECA. The FEC was also responsible for collecting and
making available to the public specific and accurate information concerning the identity
of contributors to federal candidates such as Henry Espy.
- On or before January 5, 1993, Henry Espy, not named as a defendant in this Indictment,
publicly announced his candidacy for the Democratic Party nomination for the United States
Congress from the State of Mississippi in a special primary election.
- Henry Espy sought election to become the Democratic nominee for the Mississippi
Congressional District seat being vacated by his brother, Michael Espy, when Secretary of
Agriculture Michael Espy resigned his Congressional seat to accept the position of
Secretary of Agriculture.
- On or about March 30, 1993, Henry Espy lost the special primary election for Congress.
As a result of Henry Espy's unsuccessful campaign for the Democratic Party nomination,
campaign debts were incurred. By in or about March 1994, the campaign debt was
approximately $120,000.
- The Henry Espy for Congress Committee was registered as the principal campaign committee
for Henry Espy with the FEC and was designated and authorized by Henry Espy, pursuant to
FECA, to receive contributions and make expenditures in connection with his 1993 candidacy
for the United States Congress. The Henry Espy for Congress Committee was subject to the
reporting provisions and the campaign financing limitations of FECA.
- The Henry Espy for Congress Committee was required under FECA, specifically, Title 2
United States Code §434, to file periodic reports with the FEC, which reports were
required to reflect the true identities of all individuals and entities who contributed in
excess of $200 to support the candidacy of Henry Espy in any given calendar year.
- FECA, namely Title 2 United States Code §441b, prohibited entirely and rendered
unlawful contributions by corporations, whether directly or indirectly, in connection with
the campaign of a candidate for the United States Congress.
- FECA, namely Title 2 United States Code, §441f, prohibited entirely and rendered
unlawful the making of a contribution in the name of another person, including
contributions made by individuals who are reimbursed for such contributions.
- The violations of FECA alleged herein related to the making of contributions that
aggregated more than $2,000 during the calendar year 1994.
IV. THE
SCHEME TO DEFRAUD
- From in or about March 1994 through in or about June 1994, in the District of Columbia
and elsewhere, defendant SUN-DIAMOND's Senior Corporate Officer X, and James H. Lake,
devised and intended to devise a scheme and artifice to defraud and to deprive another,
namely, Bozell, Inc. and RLSM, of the intangible right of honest services of James H.
Lake, and for obtaining money and property from Bozell, Inc. by, among other things:
- creating and causing the creation of a false expense report seeking reimbursement from
Bozell, Inc. of money purportedly expended by James H. Lake for the benefit, and on behalf
of defendant SUN-DIAMOND;
- falsifying and causing the falsification of the financial books and records of Bozell,
Inc.; and
- causing Bozell, Inc. to advance funds for the purpose of concealing an illegal corporate
campaign contribution by defendant SUN-DIAMOND to help retire the campaign debt of Henry
Espy; all by means of false and fictitious pretenses, representations, and promises,
well-knowing at the time that the pretenses, representations, and promises, when they were
made to Bozell, Inc., would be and were false and fictitious.
- It was a part of the scheme and artifice to defraud that in or about March, 1994 during
several conversations:
- Defendant SUN-DIAMOND's Senior Corporate Officer X told James H. Lake that Secretary of
Agriculture Michael Espy wanted help from Senior Corporate Officer X in raising money to
retire Henry Espy's campaign debt. Senior Corporate Officer X solicited James H. Lake's
assistance in a scheme to raise approximately $5,000 to help retire the campaign debt of
Henry Espy.
- James H. Lake and Senior Corporate Officer X agreed that they would use $5,000 of
defendant SUN-DIAMOND's corporate funds to contribute to the campaign of Henry Espy for
Congress, in violation of FECA.
- James H. Lake agreed to enlist the assistance of four other officers and employees of
the District of Columbia office of RLSM to make personal contributions, each in the amount
of $1,000.
- James H. Lake agreed with Senior Corporate Officer X that defendant SUN-DIAMOND
corporate funds would be used to reimburse the contributions made in the names of the RLSM
employees.
- After on or about March 1, 1994, James H. Lake agreed with Senior Corporate Officer X
that the reimbursement of the campaign contributors would be accomplished by having RLSM
bill defendant SUN-DIAMOND for a false and fictitious expense to conceal the contribution
by defendant SUN-DIAMOND and the reimbursement to the five campaign contributors,
including James H. Lake.
- James H. Lake and Senior Corporate Officer X agreed that RLSM would bill defendant
SUN-DIAMOND for a false and fictitious expense for the purported purchase of a table for
defendant SUN-DIAMOND at an annual fund-raising dinner (the "Dinner") held by a
the District of Columbia based not-for-profit organization.
- On or about March 10, 1994, James H. Lake, by virtue of his position and authority at
RLSM, created a false and fictitious expense for the Dinner and requested reimbursement
from Bozell, Inc. in the amount of $5,000, thereby creating false and fictitious entries
on Bozell, Inc.'s books and records.
- On or about March 14, 1994, James H. Lake caused Bozell, Inc. to issue a check in the
amount of $5,000 as reimbursement to James H. Lake for funds purportedly expended for the
Dinner on behalf of RLSM's client, defendant SUN-DIAMOND.
- From on or about March 3, 1994, until on or about March 18, 1994, James H. Lake
solicited four other officers and employees of the District of Columbia office of RLSM to
each contribute $1,000 to the Henry Espy for Congress Committee. James H. Lake promised
each of these officers and employees that their campaign contributions would be
reimbursed. Three of these individuals did as James H. Lake requested; the fourth
individual refused.
- From on or about March 3, 1994, until on or about March 24, 1994, James H. Lake, on
behalf of defendant SUN-DIAMOND, reimbursed himself and three officers and employees of
the District of Columbia office of RLSM, each in the amount of $1,000, for their campaign
contributions to the Henry Espy campaign.
- In or about March 1994, James H. Lake provided to defendant SUN-DIAMOND Senior Corporate
Officer X four checks one from James H. Lake, and three others from officers and
employees of the District of Columbia office of RLSM each in the amount of $1,000
payable to the Henry Espy for Congress Committee.
- James H. Lake retained approximately $1,000 of the $5,000 amount reimbursed to him from
Bozell, Inc. as a consequence of the submission of a false and fictitious billable expense
report.
- On or about April 26, 1994, James H. Lake, by virtue of his position and authority at
RLSM, caused RLSM to bill defendant SUN-DIAMOND $26,162.66, which included the false and
fictitious $5,000 expense for the Dinner.
- On or about April 27, 1994, defendant SUN-DIAMOND's Senior Corporate Officer X, in his
capacity as an officer of defendant SUN-DIAMOND, approved for payment RLSM's invoice
containing the $5,000 expense for the Dinner.
- On or about June 2, 1994, defendant SUN-DIAMOND sent a check for $26,162.66, payable to
RLSM, which included defendant SUN-DIAMOND's reimbursement to RLSM for payment of the
false and fictitious $5,000 expense for the Dinner which RLSM had earlier reimbursed to
James H. Lake.
- On or about April 1, 1994, in the District of Columbia, defendant SUN-DIAMOND's Senior
Corporate Officer X opened a bank account at a District of Columbia bank in the name of:
"Henry Espy for Congress." Senior Corporate Officer X had sole signature
authority over this bank account. Senior Corporate Officer X deposited and caused to be
deposited the four $1,000 checks referenced above to the Henry Espy for Congress account.
- On or about March 1, 1994, in the District of Columbia and elsewhere, defendant
SUN-DIAMOND, acting through its Senior Corporate Officer X, for the purpose of executing
the aforesaid scheme and artifice to defraud, and attempting to do so, knowingly and
willfully transmitted and caused to be transmitted in interstate commerce, by means of a
wire communication, that is: a telephonic call between defendant SUN-DIAMOND's Senior
Corporate Officer X in California and James H. Lake's office at RLSM, in the District of
Columbia, writings, signs, signals, pictures and sounds, that is: among other things, a
message that Senior Corporate Officer X needed to speak with James H. Lake.
(In
violation of Title 18, United States Code, §§ 1343 and 1346,
and Title 18, United States Code, § 2)
THE GRAND JURY FURTHER CHARGES:
COUNT FOUR
- Paragraphs 1 through 21 of Count Three of this Indictment are realleged and incorporated
by reference as though set forth in full.
- On or about March 11, 1994, in the District of Columbia and elsewhere, defendant
SUN-DIAMOND, acting through its Senior Corporate Officer X, for the purpose of executing
the aforesaid scheme and artifice to defraud, and attempting to do so, knowingly and
willfully transmitted and caused to be transmitted, in interstate commerce, by means of a
wire communication, that is: a telephonic communication by computer modem between RLSM, in
the District of Columbia, and Bozell, Inc., in Omaha, Nebraska, writings, signs, signals,
pictures and sounds, that is: a billable expense report requesting reimbursement for a
$5,000 expense for the purchase of a table at the Dinner.
(In violation of Title 18, United States Code, §§ 1343, 1346
and Title 18, United States Code, § 2)
THE GRAND JURY FURTHER CHARGES:
COUNT FIVE
- Paragraphs 1 through 21 of Count Three of this Indictment are realleged and incorporated
by reference as though set forth in full.
- From in or about March 1994, up to and including in or about April 1994, in the District
of Columbia and elsewhere, defendant SUN-DIAMOND, acting through its Senior Corporate
Officer X, knowingly and willfully made a contribution and expenditure aggregating $2,000
and more in calendar year 1994, in violation of the prohibition against corporate
contributions contained in the Federal Election Campaign Act, namely: a contribution and
expenditure totaling $4,000 of corporate assets belonging to defendant SUN-DIAMOND, a
California corporation, to the Henry Espy for Congress Committee, a federal political
committee, in connection with a primary election held to select a candidate for
Representative in Congress.
(In violation of Title 2, United States Code, §§ 441b(a) and 437g(d)(1)(A),
and Title 18, United States Code, § 2)
THE GRAND JURY FURTHER CHARGES:
COUNT SIX
- Paragraphs 1 through 21 of Count Three of this Indictment are realleged and incorporated
by reference as though set forth in full.
- From in or about March 1994, up to and including in or about April 1994, in the District
of Columbia and elsewhere, defendant SUN-DIAMOND, acting through its Senior Corporate
Officer X, knowingly and willfully made and caused to be made a contribution in the name
of another person in violation of the Federal Election Campaign Act, namely: a
contribution in the amount of $1,000 of corporate assets belonging to defendant
SUN-DIAMOND, a California corporation, in the name of James H. Lake, to the Henry Espy for
Congress Committee, a federal political committee, in connection with a primary election
held to select a candidate for Representative in Congress.
(In violation of Title 2, United States Code, §§ 441f and 437g(d)(1)(A),
and Title 18, United States Code, § 2)
THE GRAND JURY FURTHER CHARGES:
COUNT SEVEN
- Paragraphs 1 through 21 of Count Three of this Indictment are realleged and incorporated
by reference as though set forth in full.
- From in or about March 1994, up to and including in or about April 1994, in the District
of Columbia and elsewhere, defendant SUN-DIAMOND, acting through its Senior Corporate
Officer X, knowingly and willfully made and caused to be made a contribution in the name
of another person in violation of the Federal Election Campaign Act, namely: a
contribution in the amount of $1,000 of corporate assets belonging to defendant
SUN-DIAMOND, a California corporation, in the name of A, a person known to the Grand Jury
but who is not named as a defendant in this indictment, who was an officer of RLSM, to the
Henry Espy for Congress Committee, a federal political committee, in connection with a
primary election held to select a candidate for Representative in Congress.
(In violation of Title 2, United States Code, §§ 441f and 437g(d)(1)(A),
and Title 18, United States Code, § 2)
THE GRAND JURY FURTHER CHARGES:
COUNT EIGHT
- Paragraphs 1 through 21 of Count Three of this Indictment are realleged and incorporated
by reference as though set forth in full.
- From in or about March 1994, up to and including in or about April 1994, in the District
of Columbia and elsewhere, defendant SUN-DIAMOND, acting through its Senior Corporate
Officer X, knowingly and willfully made and caused to be made a contribution in the name
of another person in violation of the Federal Election Campaign Act, namely: a
contribution in the amount of $1,000 of corporate assets belonging to defendant
SUN-DIAMOND, a California corporation, in the name of B, a person known to the Grand Jury
but who is not named as a defendant in this indictment, who was an officer of RLSM, to the
Henry Espy for Congress Committee, a federal political committee, in connection with a
primary election held to select a candidate for Representative in Congress.
(In violation of Title 2, United States Code, §§ 441f and 437g(d)(1)(A),
and Title 18, United States Code, § 2)
THE GRAND JURY FURTHER CHARGES:
COUNT NINE
- Paragraphs 1 through 21 of Count Three of this Indictment are realleged and incorporated
by reference as though set forth in full.
- From in or about March 1994, up to and including in or about April 1994, in the District
of Columbia and elsewhere, defendant SUN-DIAMOND, acting through its Senior Corporate
Officer X, knowingly and willfully made and caused to be made a contribution in the name
of another person in violation of the Federal Election Campaign Act, namely: a
contribution in the amount of $1,000 of corporate assets belonging to defendant
SUN-DIAMOND, a California corporation, in the name of C, a person known to the Grand Jury
but who is not named as a defendant in this indictment, who was an officer of RLSM, to the
Henry Espy for Congress Committee, a federal political committee, in connection with a
primary election held to select a candidate for Representative in Congress.
(In violation of Title 2, United States Code, §§ 441f and
437g(d)(1)(A),
and Title 18, United States Code, § 2)
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