United States v. Spano

411 F. Supp. 2d 923, 2006 U.S. Dist. LEXIS 3064, 2006 WL 212146
CourtDistrict Court, N.D. Illinois
DecidedJanuary 24, 2006
Docket03-1100, 03-1113, 03-1195, 01 CR 30
StatusPublished
Cited by2 cases

This text of 411 F. Supp. 2d 923 (United States v. Spano) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States v. Spano, 411 F. Supp. 2d 923, 2006 U.S. Dist. LEXIS 3064, 2006 WL 212146 (N.D. Ill. 2006).

Opinion

MEMORANDUM OPINION AND ORDER

CASTILLO, District Judge.

The defendants in this public corruption case seek to have their sentences reduced via new opportunities provided by United States v. Booker, 543 U.S. 220, 125 S.Ct. 738, 160 L.Ed.2d 621 (2005). The defendants’ direct appeal of their convictions before this Court were still pending more than two years after their sentencing when the Supreme Court dramatically changed the world of federal sentencing in its Booker decision on January 12, 2005. Subsequent to this decision, each Circuit has struggled to determine how it would apply Booker to cases pending on appeal. In the Seventh Circuit, United States v. Paladino, 401 F.3d 471 (7th Cir.2005), determined that all cases pending on appeal would generally be remanded back to the district court for general reevaluation in light of Booker’s determination that the *925 Sentencing Guidelines were no longer binding and mandatory.

On March 24, 2005, the Seventh Circuit affirmed the defendants’ convictions and ordered a limited remand to this Court pursuant to Paladino for proceedings to determine whether this Court would have imposed different sentences in this case if allowed to re-sentence. See United States v. Spano, 401 F.3d 837, 842-43 (7th Cir. 2005). This Court followed the suggested Paladino procedure and requested briefing on this issue from the parties. This procedure requires a district court judge to attempt to go back in history to the initial sentencing hearings for all affected defendants. After careful evaluation of the parties’ submissions, the sentencing transcript and the pre-sentence reports, this Court has decided to hew to its original sentences for the reasons set forth herein. 1

RELEVANT FACTS

A. Tnal Evidence

The facts surrounding the convictions of the Michael Spano, Sr., Emil Schullo, and James Inendino (collectively, “defendants”) were more than adequately summarized by the Seventh Circuit Court of Appeals. See Spano, 401 F.3d at 838-39. A jury found Emil Schullo (“Schullo”), the Director of Public Safety for the Town of Cicero, Illinois, guilty of accepting a bribe valued at $5000 or more in violation of 18 U.S.C. § 666(a)(1)(B), and of the theft of at least $5000 from a federally-funded program in violation of § 666(a)(1)(A). His co-defendants, Michael Spano (“Spano”) and James Inendino (“Inendino”), were charged and convicted of, among other offenses, paying the bribe in violation of § 666(a)(2), and aiding and abetting the theft in violation of 18 U.S.C. § 2 and § 666(a)(1)(A). The jury also found all three men guilty of conspiring to embezzle, steal, or obtain by fraud monies owned by an organization receiving federal funds, namely, the Town of Cicero, under 18 U.S.C. § 371 and § 666(a)(1)(A).

Schullo’s responsibilities as Cicero’s Director of Public Safety included oversight of the town’s police, fire, and health departments. The charges in this case arose out of a private investigation initiated by Schullo to determine whether three police officers lived outside of Cicero’s boundaries in violation of a town ordinance. The ordinance required that town employees, including police officers and firefighters, live within the town limits. The investigation was allegedly prompted by a formal labor grievance filed by the town’s firefighters, who initially discovered that the three police officers lived outside Cicero. The firefighters’ grievance claimed that the residence requirement for town employees was being applied disparately and that they too should be allowed to live outside Cicero’s boundaries.

Evidence at trial showed that the Town of Cicero paid $75,831.24 for the investigation commissioned by Schullo—an investigation that in reality had only $34,456.90 in expenses associated with it, although apparently none of the money was ever used to resolve the firefighters’ grievance. The remaining $41,374.34 paid by the town was divided up among the various co-conspirators, including Schullo, Spano and Inendino.

As shown by the trial evidence, this was a classic ease of public corruption. The defendants stole public funds from the Town of Cicero thanks to the corrupt ser *926 vices of Sehullo who theoretically was supposed to be serving as Cicero’s Chief of Police and Director of Public Safety. Through their criminal scheme, the defendants stole monies from the Town of Cicero through false and inflated billings invoiced to the Town in connection with its investigation into whether its police officers were living within Cicero as required by Town ordinance. Each of the defendants had a designated role to play in making the criminal scheme work. In carrying out their roles, the defendants all had contact in varying degrees with Sam Rovetuso, a convicted felon who was cooperating with the government at the time of this investigation, and who recorded numerous conversations with the defendants outlining their participation in the crimes. Mr. Rovetuso died in 1999 from leukemia.

The criminal venture itself had three main phases. First, the defendants defrauded the Town of Cicero through false billings for work performed at defendant Sehullo’s request. Sehullo received a 10% kickback for providing this fraudulent opportunity, and the other defendants were paid by inflated billings to the Town. This portion of the criminal scheme was charged in Counts One through Four of the indictment.

Second, the defendants laundered the proceeds of the theft/kickback scheme through the currency exchange at which Inendino worked, the Taylor-Ogden Currency Exchange. The Town of Cicero issued six checks as a result of the criminal scheme. The first three checks were cashed directly at the Taylor-Ogden Currency Exchange, and the cash was split up amongst the conspirators. Spano believed that there was too much risk having the checks cashed directly at the currency exchange, so the last three checks were deposited into the bank account of Rovetuso’s mother, and then checks written on that account were cashed at the currency exchange and at the account holder’s bank. This cash was then distributed amongst the conspirators. This laundering activity was charged in Counts Five through Eleven of the indictment; Spano and Inendino were named in these counts.

Third, and lastly, in order to further conceal their receipt of income from the Town of Cicero, the defendants agreed to have Rovetuso report the entirety of the income on his 1995 and 1996 tax returns. The other defendants did not report this income on them own returns. Spano and Inendino agreed to pay Rovetuso a proportionate share of the resulting tax liability “under the table.” This activity was charged in Count Twelve of the indictment.

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Related

United States v. Caputo
456 F. Supp. 2d 970 (N.D. Illinois, 2006)
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423 F. Supp. 2d 800 (N.D. Illinois, 2006)

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Bluebook (online)
411 F. Supp. 2d 923, 2006 U.S. Dist. LEXIS 3064, 2006 WL 212146, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-v-spano-ilnd-2006.