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United States v. Brown

August 22, 1984


Appeals from the United States District Court for the Northern District of Illinois, Eastern Division. No. 82 CR 384 -- Marvin E. Aspen, Judge.

Author: Eschbach

Before ESCHBACH and POSNER, Circuit Judges and SWYGERT, Senior Circuit Judge.

ESCHBACH, Circuit Judge. The appellant, William Brown, was charged with six counts of willfully misapplying or embezzling Comprehensive Employment and Training Act ("CETA") funds, 18 U.S.C. § 665, and six counts of making material false statements in a matter within the jurisdiction of a federal agency, 18 U.S.C. § 1001. One of the § 665 and one of the § 1001 counts were dropped before the bench trial in this case, and the appellant was convicted on the remaining counts.*fn1

On appeal, Brown challenges the sufficiency of the evidence on all of the counts and the denial of his post-trial motions relating to the adequacy of his representation and to the government's alleged failure to disclose exculpatory material specifically requested by Brown. We have reviewed the appellant's claims, find them to be without merit, and accordingly affirm the judgments of conviction.


During 1981, the Archdiocese of Chicago conducted two programs to provide training and employment for economically-disadvantaged youths. Both programs were funded by the United States Department of Labor, which allocated CETA funds to the programs pursuant to contracts with the City of Chicago. The Archdiocese implemented its programs through various community groups which were invited to participate. In January or February, 1981, Brown contacted the Archdiocese and indicated that he wanted to open a CETA work site at the Glacier Center, which he operated. As it had with approximately 100 other work sites involved in its programs, the Archdiocese entered into a "work-site agreement" with Brown, specifying the location of the site, the type of work the participants would perform, the work-site supervisor, and the number of young people to be involved.

Work-site supervisors had the primary responsibility for implementing and monitoring the CETA-funded programs. They managed the activities at the site, solicited and supervised participants, monitored the scheduled activities, kept and reported time records for payroll purposes, and distributed paychecks. Because there are extensive eligibility requirements for participation in CETA-funded programs, the Archdiocese gave each work-site supervisor, including Brown, a training session concerning the documentation required to authorize a young person to participate. Once the participant's eligibility was documented and his participation approved by the the Archdiocese and the City of Chicago, he was certified to begin work in the program.

During the summer of 1981, Brown, as the Glacier center work-site supervisor, submitted a number of time sheets that falsely claimed that individuals who had been certified to participate in the program had worked a number of hours at the Center. Accordingly, the Archdiocese issued paychecks to these individuals based on the hours claimed on the time sheets and sent them to Brown for distribution. Brown subsequently forged the names of the payees and cashed the checks.

At trial, four of the persons in whose names Brown received paychecks testified that they had never worked at the Center. A fifth person had worked at the Center for four weeks, but had been paid for only two of those weeks. It was established that Brown had submitted time sheets indicating that each of these individuals had worked various hours at the Center, when in fact they had not. Brown admitted these facts but claimed that he had distributed the proceeds from the paychecks to other eligible but uncertified young people that he had substituted in the places of the certified workers whose names appeared on the time sheets. He claimed that the substituted workers had actually worked the hours indicated on the sheets. Brown could not remember the names of any of these substituted workers, and none testified at trial.

After the bench trial in his case was concluded, Brown filed a pro se motion for a new trial, asserting that his court-appointed counsel had inadequately represented him. Brown also retained new counsel, who filed a separate motion for a new trial which alleged that the government had violated the rule of Brady v. Maryland, 373 U.S. 83, 10 L. Ed. 2d 215, 83 S. Ct. 1194 (1963), by failing to disclose an allegedly exculpatory interview with the mother of a substituted worker. The district court denied both motions without a hearing.


A. Section 665

To obtain a conviction under § 665, the government must prove (1) that the accused was an officer, director, agent, or employee of an agency receiving financial assistance under CETA; and (2) that the accused embezzled, willfully misapplied, stole, or obtained by fraud "moneys, funds, assets or property that are the subject of a grant or contract of assistance." United States v. Coleman, 590 F.2d 228, 230 (7th Cir. 1978). The appellant urges that the government's proof of the second of these elements fails because the government did not show what, if anything, the appellant did with the money he received when he cashed the Archdiocese paychecks. Relying on United States v. Overbay, 444 F. Supp. 259 (E.D. Tenn. 1977), Brown argues that proof of what was actually done with the money is essential to the government's case.

The indictment in Overbay charged that the defendant "willfully and knowingly embezzled and obtained by fraud" money in the form of checks, and that she thereafter forged the names of the payees on the checks and "converted [the proceeds] to her own use." United States v. Overbay, 444 F. Supp. 256, 257 (E.D. Tenn. 1977) (companion case challenging only sufficiency of indictment). At trial, the defendant, who directed a CETA-funded program, testified that she had indeed cashed checks made payable to others, but that she had distributed the proceeds to other children in the program in accordance with the program's goals. After a jury was unable to return a verdict, the trial court directed a verdict of acquittal. The court noted that the prosecution's proof did not conform to the allegations in the ...

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