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United States v. Belzer

decided: September 18, 1984.


Appeal from the United States District Court for the Northern District of Indiana, South Bend Division. No. 83 Cr 2 -- Allen Sharp, Judge.

Posner and Flaum, Circuit Judges, and Gordon, Senior District Judge.*fn*

Author: Flaum

FLAUM, Circuit Judge.

This is an appeal following a jury trial in which the defendants were convicted of violating federal counterfeiting laws. The defendants' main argument on this appeal is that the government's undercover operation leading to their arrests was so outrageous as to violate fundamental principles of due process. We disagree, and we affirm the convictions.


During the summer of 1982, James Farthing traveled from Indiana to Florida to purchase counterfeit currency from the defendants John Evans and John Belzer. He did not make the purchase, however, because the quality of the bills was poor. Later that summer, Farthing, Evans, and Belzer decided to make counterfeit currency together. They bought a printing press from an Indiana company, as well as an arc light plate burner, a vacuum table, a platemaker, paper, and various printing supplies. Shortly thereafter, they determined that they needed $5,000 more to finance their counterfeiting operation, and began to search for someone to provide them with this amount.

At the same time, the defendant Richard "Pete" Clements was looking for a source of counterfeit currency. Through mutual acquaintances, it was arranged for Clements to provide Farthing, Evans, and Belzer with $5,000. Clements supplied the money, requesting that in return he get as much counterfeit currency as he could.*fn1

Evans, Belzer and Farthing then began to attempt to produce counterfeit currency in a garage in Indiana. However, they had difficulty operating the printing press and were unable to produce bills of high quality. After several weeks they abandoned the project. At this point, sometime in November 1982, Evans and Belzer returned to Florida, and Clements had the equipment hauled away and stored in a trailer.

In early December 1982, Clements contacted Farthing about the possibility of renewing the counterfeiting effort. During December and January, the two had several more discussions about this subject. During these discussions, Clements expressed an interest in having Belzer and Evans return to Indiana to resume the counterfeiting.

In late January 1983, Farthing was contacted by United States Secret Service Special Agent Lawrence D. Haas Jr. The Secret Service had received a tip from a confidential informant several months earlier, informing it that Farthing was involved in a counterfeiting operation. In December 1982, the Secret Service had learned that Farthing had been arrested on drug charges in Indiana. Thus, in late January 1983, Haas and Farthing discussed the possibility of Farthing assisting the Secret Service in an undercover investigation of Belzer, Evans, and Clements. Farthing agreed to assist the Secret Service, and in return Haas promised to make Farthing's cooperation known to the Indiana authorities involved in Farthing's drug prosecution. Haas supplied Farthing with equipment for tape recording phone conversations, and requested that he contact Clements, Belzer, and Evans about resuming their counterfeiting operation.

On February 1, 1983, Farthing made the first of many tape recorded phone calls to the defendants. In a conversation with Clements, he suggested that they plan another attempt at counterfeiting, and Clements agreed. The two men then began to discuss the details of the operation. At this time, Clements indicated that he would be willing to travel to Florida to pick up Belzer and Evans and bring them back to Indiana.

On February 2, Evans phoned Farthing, returning a call Farthing had made to him earlier. They discussed the counterfeiting operation. Farthing told Evans that they would be purchasing additional equipment and thus would be able to make counterfeit bills of better quality than those they had made previously. Evans then indicated that he could make counterfeit money, and that he would be willing to try again. During the next few days, Evans and Farthing had several more phone conversations in which they discussed counterfeiting. During one of these discussions, Evans stated that he and Belzer in the past had made counterfeit currency that was not high quality, but that had "passed." Tr. at 571.

During several other phone conversations with Farthing, Evans showed some resistance to traveling to Indiana. He stated that he and Belzer would prefer to run the counterfeiting operation in Florida. At several points, Evans indicated that they might withdraw from the scheme altogether. Farthing also spoke with Belzer, who also stated that he did not want to leave Florida. Ultimately, however, Farthing was able to persuade Evans and Belzer to travel to Indiana. In so doing, he promised them that they would receive $500 each up front, that all the money to finance the operation would be supplied by Clements, and that Clements would travel to Florida and drive them back to Indiana.

On February 10, Clements met Belzer and Evans in Florida and the three men set out for Indiana. While they were traveling, the Secret Service rented a graphic arts camera and brought it to a slaughterhouse located on a farm that was owned by Clements's brother, which is where the counterfeiting operation was to take place. This camera is used to make photographic negatives which are then used to make offset printing plates, and ...

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