United States v. Siegel

717 F.2d 9 (1983)

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Nature of the Case

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Facts

Mego Int'l was a publicly held international manufacturer and distributor of toys and games. Mego was one of its wholly-owned subsidiaries. Abrams (D1) was chairman of the board of Mego Int'l and its president until 1980. Siegel (D) was secretary of Mego Int'l and executive vice president of Mego. Ds developed a scheme to make unrecorded cash sales of Mego merchandise which had either been closed out and marked down for clearance or returned because of damage or defect. D1 conducted some cash transactions himself. D also dealt in cash transactions, supervising cash sales through a retail store of imported shirts worth over $30,000. Additional 'off the books' sales to local merchants together generated in excess of $100,000 in cash. These cash sales were not recorded on Mego's books. The indictment charged that Ds used the cash for bribery and self-enrichment. The government called several witnesses who, in addition to testifying to the unrecorded cash transactions, recounted their knowledge of the uses to which the money was put. The proceeds from the cash sales were used in part to bribe union officials to secure labor peace. Ds used the money to get a shipment of containers off the docks because of a threatened strike. The cash sales were not recorded on Mego's books. Eventually the scheme was disclosed to government prosecutors in 1980. Ds were convicted and appealed.