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If a scheme is devised with the intent to defraud, and the mails are used in executing the scheme, the fact that there is no misrepresentation of a single existing fact is immaterial. It is only necessary to prove that it is a scheme reasonably calculated to deceive, and that the mail service of the United States was used and intended to be used in the execution of the scheme. Moreover, deceitful statements of half truths or the concealment of material facts is actual fraud violative of the mail fraud statute. In addition, the deception need not be premised upon verbalized words alone. The arrangement of the words, or the circumstances in which they are used may convey the false and deceptive appearance.
This is a mail fraud case involving the real estate activities of Marvin Lustiger in Mohave County, Arizona. The grand jury returned a nineteen-count indictment against Lustiger for violations of 18 U.S.C. § 1341 (1964), between September 7, 1960, and the filing of the indictment on October 25, 1963. Each count charged him with mailing a letter or printed matter to a named individual in furtherance of a scheme to defraud such person. The mailings occurred at various times between February 28, 1961 and April 7, 1963. Counts IX and X were thereafter dismissed. After a nonjury trial the district court convicted Lustiger on the remaining seventeen counts. Lustiger then took this appeal. Lustiger's primary contention is that the evidence adduced at the trial was insufficient to support the trial court's finding and conclusion that he engaged in a scheme to defraud or obtain money by means of false or fraudulent pretenses, representations or promises. It was stipulated prior to trial that Lustiger used the mail in connection with his land sales.
Was Lustiger’s mail fraud conviction proper?
The court affirmed, finding that the evidence was overwhelming that Lustiger's advertising materials were in some respects false and, apart from falsity were, when considered as a whole, fraudulently deceptive and misleading, exhibiting an intent and purpose to defraud. The court found that Lustiger failed to request under Fed. R. Crim. P. 23(c) that the district court make special findings of facts, and thus he could not obtain reversal on the ground that some of the representations or concealment of material fact relied upon by appellee United States were not proved to be false, misleading, or deceptive. The court found that Lustiger's refund and exchange policies did not necessarily negate a finding of bad faith. The court found that U.S. Const. amend. IV did not preclude postal inspectors from copying information from the outside of sealed envelopes in the mail, where no substantial delay in the delivery was involved, and that a "mail watch," involving no substantial delay, did not violate 18 U.S.C.S. § 170.