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United States v. Gurtunca

decided: December 16, 1987.

UNITED STATES OF AMERICA, PLAINTIFF-APPELLEE,
v.
ALI ERDOGAN GURTUNCA, A/K/A "ALI TURK", DEFENDANT-APPELLANT



Appeal from the United States District Court for the Eastern District of Wisconsin, No. 85-CR-26, Terence T. Evans, Judge.

Ripple and Manion, Circuit Judges, and Eschbach, Senior Circuit Judge.

Author: Manion

Manion, Circuit Judge.

Ali Erdogan Gurtunca, also known as Ali Turk, worked during the years 1978-1981 as a self-employed consultant-loan broker. Gurtunca would tell potential clients that he had connections with foreign sources (usually Middle Eastern) who had large amounts of money available to loan at low interest rates. Gurtunca would tell the clients that before he could arrange a loan, the client would have to pay him in advance to cover items such as fees and expenses. Gurtunca's "services" did not come cheaply -- his daily charges generally ranged from $400 to $1,000.

A lot of people paid Gurtunca a lot of money in hopes of obtaining low-interest loans. In most cases, these clients received nothing. Testifying at trial were over thirty people who had paid Gurtunca money but had obtained no loans.

Gurtunca failed to report most of the money he received from clients on his income tax returns. During 1978-1981, Gurtunca filed, along with his Forms 1040, Schedules C ("Profit or (Loss) From Business or Profession") that stated his main business activity as "consultant." On the Schedules C for those years, Gurtunca reported total income of $183,550. The government asserted that Gurtunca should have reported total income of $437,063.97 on his Schedules C for 1978-1981. As a result of his false reporting, the government contended that Gurtunca avoided approximately $97,000 in income taxes.

A federal grand jury in Milwaukee agreed with the government that Gurtunca had willfully underreported his income. The grand jury indicated Gurtunca, charging him with violating 26 U.S.C. § 7206(1), which provides:

Any person who --

(1) Declaration under penalties of perjury. -- Willfully makes and subscribes any return, statement, or other document, which contains or is verified by a written declaration that it is made under the penalties of perjury, and which he does not believe to be true and correct as to every material matter;

shall be guilty of a felony. . . .

The indictment charge that for 1978, 1979, and 1980, Gurtunca willfully underreported gross receipts on line 1(a) of his Schedules C, and that for 1981, Gurtunca willfully underreported total income on line 5 of his Schedule C.*fn1

After a three-day bench trial, the district court found Gurtunca guilty on all four counts. United States v. Gurtunca, 638 F. Supp. 296, 297-98 (E.D. Wis. 1986). The district court found that the funds Gurtunca received were reportable on his consulting business Schedules C, even though he may have obtained the funds by fraud. Id. at 299. The district court sentenced Gurtunca to eighteen months in prison on Count 1, and fined Gurtunca $5,000 on Counts 2 and 3. The court also placed Gurtunca on three years probation on Counts 2, 3, and 4. As conditions of probation on count 4, the court ordered Gurtunca to pay the costs of prosecution ($13,000) and to reimburse the government for the costs of his court-appointed attorneys. The district court reserved determining the amount Gurtunca must reimburse the government until after Gurtunca's court-appointed attorneys filed a request for fees; the district court has not yet determined the amount of fees that Gurtunca must pay. Gurtunca appeals both his conviction and the probation condition that he reimburse the government for his court-appointed attorneys' fees. For the reasons that follow, we affirm the district court.

I.

Because the district court has not determined the amount of attorneys' fees for which Gurtunca must reimburse the government, we must first consider whether we have jurisdiction over this appeal. 28 U.S.C. § 1291 grants courts of appeals jurisdiction over "final decisions of the district courts. . . ." The Supreme Court long ago stated that a judgment is final "when it terminates the litigation between the parties on the merits of the case and leaves nothing to be done but to enforce by execution what has been determined." St. Louis, Iron Mountain & Southern R.R. v. Southern Express Co., 108 U.S. 24, 28-29, 27 L. Ed. 638, 2 S. Ct. 6 (1883). In a ...


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