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The People v. Jeffrey Allen Whitmer

January 28, 2012

THE PEOPLE, PLAINTIFF AND RESPONDENT,
v.
JEFFREY ALLEN WHITMER, DEFENDANT AND APPELLANT.



APPEAL from a judgment of the Superior Court of Los Angeles County, Candace Beason, Judge. (Los Angeles County Super. Ct. No. GA079423)

The opinion of the court was delivered by: Manella, J.

CERTIFIED FOR PUBLICATION

Reversed in part, affirmed in part, and remanded with directions.

Appellant Jeffrey Allen Whitmer challenges his convictions on 20 counts of grand theft and 20 counts of making false financial statements. He contends he was unlawfully convicted of grand theft and making false financial statements; in addition, he maintains that his judgment of conviction must be reversed due to insufficiency of the evidence, instructional error, sentencing error and ineffective assistance of counsel. Although we hold that grand theft of an automobile does not encompass the theft of motorcycles and motorized dirt bikes, we determine that appellant suffered no prejudice from the charging of grand theft of an automobile based on the taking of motorcycles, motorized dirt bikes, and related vehicles. We further conclude that he has shown reversible error only with respect to 14 counts of making false financial statements. We therefore reverse his convictions under these counts, and otherwise affirm the judgment.

In rejecting appellant's contentions, we conclude that under People v. Bailey (1961) 55 Cal.2d 514 (Bailey), a defendant may be convicted of multiple counts of grand theft based on separate and distinct acts of grand theft committed pursuant to a single scheme. As other appellate courts have adopted a contrary interpretation of Bailey, we urge the Supreme Court to clarify the holding in Bailey.

RELEVANT PROCEDURAL BACKGROUND

On July 20, 2010, an information was filed, charging appellant with 21 counts of grand theft of an automobile (Pen. Code, § 487, subd. (d)(1)), 7 counts of making false financial statements (Pen. Code, § 532a), and 14 counts of theft of access cards or account information (Pen. Code, § 484e, subd. (d).)*fn1 Accompanying the charges was an allegation that appellant took, damaged, or destroyed property valued at more than $200,000 (§ 12022.6). Appellant pleaded not guilty and denied the special allegation.

At the prosecutor's request, the trial court dismissed one count of grand theft of an automobile and one count of making false financial statements. After the presentation of evidence, the trial court amended the information to replace the charges of theft of access cards or account information (§ 484e, subd. (d)) with charges of making false financial statements (§ 532a). The jury found appellant guilty on all counts, as amended, and found the special allegation to be true. The trial court sentenced appellant to a total term of imprisonment of 12 years. In imposing the sentence, the court stayed punishment under all the counts of making false financial statements (§ 654).

FACTS

A. Prosecution Evidence

1. Overview

The prosecution submitted evidence that appellant, while acting as manager for a motorcycle dealership, arranged for the fraudulent sale of 20 motorcycles, motorized dirt bikes, all terrain vehicles (ATVs), and similar recreational vehicles. In collaboration with Mordichi Mor, appellant arranged fraudulent sales to fictitious buyers, using falsified financing agreements and credit purchases, resulting in monetary losses to the dealership.*fn2

2. Background

Jerome Gilding owned Temple City Power Sports, a business located in San Gabriel that sold and serviced motorcycles, motorized dirt bikes, ATVs, and jet skis. Because Gilding devoted most of his time to dealerships he owned in Temecula and other locations, he employed a sales manager to operate the dealership, maintain its inventory, and supervise the sales staff, including employees in its finance department.

Customers of the dealership negotiated purchases with salespersons. The dealership made sales to customers who entered into financing agreements or paid with credit cards. In such cases, after the salesperson reached an agreement with the customer regarding an item and the manner of payment, the transaction was referred to the sales manager for approval. If approved, the transaction was sent to the dealership finance department, which collected the information necessary to process the financing agreement or credit card sale. When the dealership sold an item to a customer who failed to make the loan payments or used a bad credit card, the dealership incurred a "charge back," that is, took responsibility for the loss on the transaction. According to Gilding, to prevent charge backs, the dealership's policy was to require customers to make purchases in person and to present two forms of identification.

Ordinarily, when credit card purchases were made, the card was swiped through a credit card machine, which instantaneously sent information regarding the purchase to the pertinent bank. An approval or denial was received from the bank within a few seconds. In contrast, if the machine was set for an "offline" or "forced" sale, the machine recorded the transaction but sent no information to the bank. As a result, no immediate credit approval or denial was generated; instead, information regarding the transaction was transmitted to the bank at the end of the business day. Gilding did not permit offline sales.

Associated with each vehicle sold by the dealership is a document known as the "manufacturer certificate of origin" (MSO). The vehicle's original MSO can be used to establish title to the vehicle in other states and countries. The dealership retained the original MSO after a sale unless the vehicle was sold to an out-of-state purchaser or transferred to another dealer. The dealership had contractual obligations to several manufacturers not to sell vehicles for exportation outside the United States.

In 2009, appellant was the dealership's sales manager, and Alex Barrera was employed as a salesperson. Eric Van Hek worked in the financial department until August or September 2009, when he was replaced by Richard Carlos. In late August or early September 2009, Gilding told appellant not to deal with Mordichi Mor, who had engaged in a fraudulent transaction at the dealership in 2008.

3. Offenses

Carlos testified that he was a finance manager at the dealership for six to eight months. He had little prior experience with financial operations. According to Carlos, appellant ran the dealership and directed his activities. In the fall of 2009, Carlos often saw a person he knew as "Mordichi" talking to appellant in the dealership. After meeting with Mordichi, appellant directed Carlos to process sales transactions involving customers Carlos had never met, contrary to the dealership's policy. Whenever the transaction involved a credit card, appellant told Carlos to process it as an offline sale. Carlos prepared the paperwork for each transaction and gave it to appellant, who returned the documents to him with the customer's signature. Carlos heard appellant direct other employees to deliver the purchased vehicles to Mordichi's home and obtain the customers' signatures there.

In December 2009, when Carlos received phone calls from banks attempting to locate the customers, he brought the calls to the attention of appellant, who said he would take care of them. After a fraud inquiry began, Carlos overheard appellant suggest to investigating police officers that appellant did not know Mor's full name. Later, Carlos saw appellant shredding some documents. Appellant directed Carlos not to place the shredded documents in the dealership's dumpster, but to dispose of them elsewhere.

Angela Wilcox, a dealership employee, testified that during the fall of 2009, she saw appellant with Mor many times in the dealership. At appellant's request, she gave appellant original MSOs from the dealership's files related to deals appellant arranged with Mor. Later, she overheard appellant tell police officers that he was unsure of Mor's name, even though Mor was a well known customer whose name and address were in the dealership's computer system. Afterward, Carlos told her that appellant had asked him to dispose of shredded documents off the dealership's premises.

Gilding testified that in mid-December 2009, a credit card company told him that credit card usage had increased at the dealership, and that he should expect charge backs. He initiated an inquiry that uncovered 20 potentially fraudulent sales of motorcycles, motorized dirt bikes, ATVs, and recreational vehicles at the dealership from August 4 to December 8, 2009. Barrera was the salesperson in all the sales, each of which involved one of seven purported buyers. None of the purported buyers was Mor. The first two sales were processed by Van Hek, and the remaining sales were processed by Carlos. Fourteen of the transactions involved offline credit sales, and six involved financing agreements. The dealership incurred a charge back on each sale ranging from $9,100 to $21,479.80, resulting in losses exceeding $250,000. In addition, the original MSOs for the vehicles in the dealership's files had been replaced by copies, even though the transactions were not of the type that required the dealership to transfer the original MSO to the purchaser.

Shortly after Gilding discovered the potential fraud, Barrera stopped appearing for work. On December 15, 2009, Los Angeles County Sheriff's Department Detective David Swanson interviewed appellant regarding the potential fraud. Appellant described Mor as a person who "hung around" the dealership, but denied that Mor was his friend. Appellant further stated that Mor had introduced the actual buyers to him and recommended them as customers.

Later, El Monte Police Department Detective Armando Valenzuela determined that the identification information provided for the buyers on the sales documents was false, and that the existence of the buyers could not be established. He also discovered that several of the vehicles had been shipped to Israel.

On February 16, 2010, Detective Valenzuela, accompanied by El Monte Police Department Detective Brian Villa, interviewed appellant. Appellant initially stated that "somebody named Mordichai" had referred the purchasers, who appeared in person at the dealership. When the detectives replied that they had information establishing that appellant personally knew Mor, he became agitated and asked, "Am I under arrest?" The detectives then arrested him. After receiving Miranda warnings,*fn3 appellant stated that Mor had "got[ten] the ball rolling" on the transactions, that Van Hek had taught him how to do offline transactions, and that he had participated for "personal gain" because he faced "some bad times at home economically." Appellant also acknowledged that none of the purchasers came to the dealership.

B. Defense Evidence

Appellant testified that he had only a professional relationship with Mor, who often brokered transactions at the dealership. Appellant denied that Gilding warned him not to do business with Mor, that he arranged the fraudulent sales with Mor, or that he directed employees to deliver the vehicles to Mor. He also denied any knowledge that the sales were fraudulent when they were transacted.

According to appellant, Carlos had primary responsibility for the financial aspects of the transactions. Appellant's role in a transaction was limited to approving the salesperson's initial agreement with the customer before it moved to a financial manager. If the customer chose to pay by credit card, the financial manager was responsible for collecting the payment through the credit card machine; if the customer chose to finance the purchase, the financial manager was responsible for obtaining the relevant documentation. In each case, the purchase documents were then transmitted to Gilding's Temecula dealership for final processing before they were returned to Temple City Power Sports.

Appellant further testified that after the fraud was discovered, he told police officers that he was unsure of Mor's name because people referred to Mor in different ways. Later, in February 2010, when appellant met with Detectives Valenzuela and Villa, Villa acted in an insulting and threatening manner. Appellant denied having admitted any misconduct during the interview.*fn4

Ryan Morgan testified that in the fall of 2009, appellant directed him to deliver vehicles to the home of someone he knew as "Mordichi." In signing for the deliveries, Mordichi used the name of the person identified in the contract. Stephen Valdez, a dealership salesperson, testified that he accompanied Morgan during one such delivery.

DISCUSSION

Appellant contends (1) that he was unlawfully convicted of grand theft of an automobile, (2) that he was improperly convicted of multiple counts of grand theft, (3) that he was unlawfully convicted of making false financial statements, (4) that there is insufficient evidence to support his convictions, (5) that the trial court erred in failing to instruct on aiding and abetting liability, and (6) that he received ineffective assistance of counsel. As explained below, ...


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