ILNews

Judges remand securities fraud case on statute-of-limitation issue

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The Indiana Court of Appeals has ordered a trial court to reconsider whether it should discharge certain charges of securities fraud because the charges fall outside the statute of limitation.

Vaughn A. Reeves Jr. faces 10 counts of Class C felony aiding, inducing, or causing securities fraud. In July 2005, the United States Securities and Exchange Commission obtained an injunction against Alanar, a company run by Reeves’ family, to cease operations. Alanar used a Ponzi-like scheme to run the financing company geared toward churches and nonprofits.

Reeves was charged on June 30, 2009, alleging that for each count from September 2000 to July 2005, he knowingly or intentionally aided, induced, or caused another person to commit securities fraud. There is a five-year statute of limitation for the charge, but the probable cause affidavit invoked the concealment of evidence exception in Indiana Code Section 34-41-4-2(h)(2) to explain why the statute of limitation didn’t apply.

Reeves asserted that evidence showed the state had knowledge of potential wrongdoing by the company before 2005. The trial court denied his motion to dismiss, citing the concealment of evidence exception.

On interlocutory appeal in Vaughn A. Reeves, Jr. v. State of Indiana, No. 77A04-1005-CR-292, the appellate judges upheld the denial of Reeves’ motion to dismiss on charges that include offenses that allegedly occurred on or after June 30, 2004, as they would still fall within the five year statute of limitations. Acts occurring between September 2000 and June 29, 2004, fall outside that period.

The Court of Appeals needed to look at whether the state met its initial burden of making sufficient allegations in the charging information that the offenses Reeves committed were within the applicable statute of limitation. The judges found the charging information didn’t contain any allegation of the concealment of evidence exception or alleged dates of the concealment. The state didn’t allege it lacked sufficient evidence to charge Reeves or that his offense couldn’t have been discovered by due diligence, wrote Judge Carr Darden.

“We note, however, that the probable cause affidavit does contain specific allegations regarding the concealment of evidence exception that would have put Reeves on notice that the State intends to rely on the concealment of evidence exception for the purpose of bringing all the alleged acts within the five-year statute of limitation,” he wrote. “Therefore, under the specific facts of this case, we remand to the trial court for consideration, as set forth in Indiana Code section 35-34-1-4(d), of whether it will discharge the defendant as to the dates specified above or deny the discharge upon determining that the prosecutor would be entitled to cure the information by amendment.”

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  2. The practitioners and judges who hail E-filing as the Saviour of the West need to contain their respective excitements. E-filing is federal court requires the practitioner to cram his motion practice into pigeonholes created by IT people. Compound motions or those seeking alternative relief are effectively barred, unless the practitioner wants to receive a tart note from some functionary admonishing about the "problem". E-filing is just another method by which courts and judges transfer their burden to practitioners, who are the really the only powerless components of the system. Of COURSE it is easier for the court to require all of its imput to conform to certain formats, but this imposition does NOT improve the quality of the practice of law and does NOT improve the ability of the practitioner to advocate for his client or to fashion pleadings that exactly conform to his client's best interests. And we should be very wary of the disingenuous pablum about the costs. The courts will find a way to stick it to the practitioner. Lake County is a VERY good example of this rapaciousness. Any one who does not believe this is invited to review the various special fees that system imposes upon practitioners- as practitioners- and upon each case ON TOP of the court costs normal in every case manually filed. Jurisprudence according to Aldous Huxley.

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  5. I am the mother of the child in this case. My silence on the matter was due to the fact that I filed, both in Illinois and Indiana, child support cases. I even filed supporting documentation with the Indiana family law court. Not sure whether this information was provided to the court of appeals or not. Wish the case was done before moving to Indiana, because no matter what, there is NO WAY the state of Illinois would have allowed an appeal on a child support case!

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