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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Criminal Action No. 04-cr-103-REB UNITED STATES OF AMERICA, Plaintiff,

NORMAN SCHMIDT, GEORGE ALAN WEED, CHARLES LEWIS, MICHAEL D. SMITH, Defendants. _______________________________________________________________ REPORTER'S TRANSCRIPT TRIAL TO JURY - VOLUME VI _______________________________________________________________ Proceedings before the HONORABLE ROBERT E. BLACKBURN, Judge, United States District Court for the District of Colorado, commencing at 8:25 a.m., on the 9th day of April, 2007, in Courtroom A701, Alfred A. Arraj United States Courthouse, 901 19th Street, Denver, Colorado. APPEARANCES WYATT B. ANGELO, MATTHEW KIRSCH, Assistant United States Attorneys, 1225 Seventeenth Street, #700, Denver, Colorado, appearing for the Government. Suzanne M. Claar, Official Reporter 901 19th St. Denver, Colorado, 80294-3589 (303)825-8874 PROCEEDINGS REPORTED BY MECHANICAL STENOGRAPHY TRANSCRIPTION PRODUCED BY COMPUTER

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APPEARANCES (Continued) PETER R. BORNSTEIN, 1600 Broadway, #2350, Denver, Colorado, THOMAS J. HAMMOND, 1544 Race Street, Denver, Colorado, appearing with Defendant Schmidt. THOMAS E. GOODREID, 1801 Broadway, #1100, Denver, Colorado, appearing with Defendant Weed. RONALD GAINOR, 6414 Fairways Drive, Longmont, Colorado, appearing with Defendant Lewis. DECLAN J. O'DONNELL, 777 Fifth Street, Castle Rock, Colorado, RICHARD N. STUCKEY, 2150 West 29th Avenue, #500, Denver, Colorado, appearing with Defendant Smith.

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P R O C E E D I N G S (Proceedings resumed at 8:20 a.m.) THE COURT: Thank you. Please be seated.

Good morning.

Once again, we convene on the record in

open court outside the presence and hearing of the jurors who are in recess until 8:30 a.m. It is now approximately 8:24 a.m.

according to the courtroom clock. We convene to discuss the government's proffer of Government's Exhibit 12030 for identification. Any objection by any one or more of the defendants? MR. BORNSTEIN: Mr. Schmidt. THE COURT: Very well. Your Honor, at the outset, we would Yes, your Honor. On behalf of

MR. BORNSTEIN:

remind the court that we made an objection to Mr. Schmidt's conviction coming into this case on any basis early in the case by means of a pretrial motion. The court entered an earlier Pretrial Order saying that the conviction did apply to the securities counts in line with what the prosecution's response was to our objection that it come in for any purpose. We have now looked at Exhibit 12030 and have two fall-back positions, having lost the first position. We now

take the position that the exhibit as originally tendered should be redacted, and we have discussed with the government a

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redacted version of 12030, and we now have a redacted version that's acceptable in form preserving substance. We also ask that there be a limiting instruction that goes along with the instruction of this exhibit, and perhaps also with testimony about the conviction from individual investors who are asked questions about whether they would change their investment or make an investment or whether they relied on something or another relating to the conviction. For discussion purposes, I have had a proposed limiting instruction given to the court, and I propose that something like that be given in connection with Exhibit 12030. THE COURT: So there really aren't any objections.

There is a stipulation with respect to a redacted Government's Exhibit 12030 approved as to form, and there is a request for a limiting instruction under F.~R.~E. 105. Do any one or more of the other defendants join in this objection or have independent objections? Mr. Gainor for Mr. Lewis. MR. GAINOR: THE COURT: MR. GAINOR: of Mr. Schmidt. Good morning, your Honor. Good morning. Your Honor, we would join in the objection

I have participated with Mr. Bornstein in the

drafting of this instruction, this proposed instruction that has been given to the court, but I, on behalf of Mr. Lewis, would like to reiterate that there were actually two motions

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challenging the admission of this conviction, at least from Mr. Lewis. I think the first motion was embodied, or at least responded to by the court in document No. 429, which was the original motions to delete surplusage from the indictment, which was denied. Then a motion under docket No. 653 was filed by Mr. Lewis seeking severance of the security fraud counts based on prior court rulings finding that these convictions were not to be admitted under a 403 analysis, and the order encompassing that decision denying 653 can be found at docket No. 676. I know that today we were just going to deal with Mr. Schmidt's conviction, but with regard to the objections made by Mr. Schmidt and the instruction that has been proffered, we would be joining. THE COURT: Thank you.

Objections by any other codefendant? Response by the government. MR. KIRSCH: Thank you, your Honor. First, I just

realized the defense attorneys have a copy of the proposed redaction. I didn't provide it to the court. May I approach

the clerk for that purpose? THE COURT: MR. KIRSCH: You may. Thank you.

I am providing an original and one copy

for the court, your Honor.

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THE COURT: MR. KIRSCH:

Thank you. Your Honor, the government would not

object to the limiting instruction proposed by the defendants in this case. At this time, what the government intends to do, based on the fact that we are going to be -- we expect to be in a similar situation with defendant Lewis, is we intend to hold off on publication of either this exhibit that we have just been considering, 12030, or 12031, which we have not yet offered, but which we intend to offer later in the trial as a certified copy of the record of conviction for Charles Lewis. We are will also going to attempt to look at that document in advance and address any objectionable portions of it before we offer it. Given that that's our intent, what we would propose to do is to wait until we are at the point where we are able to do that with Mr. Lewis's conviction, offer both of them at the same time, and publish them both at the same time so the court was only required to read the limiting instruction once. I also just wanted to inform the court that with respect to questions about those convictions, the government, with a couple of -- let me state the general rule first. In

general, the government intends to do what is it has been doing, which is to simply ask whether or not people were informed about any felony convictions, and then follow it up with a question

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about whether or not knowledge of that would have made a difference to their investment decision. We do not intend to ask specific witnesses whether they were aware that Norman Schmidt, for example, had been convicted of a felony or that Charles Lewis had been convicted of a felony with a couple of exceptions. The reason for those exceptions, we do have a couple of witnesses who actually gained that specific knowledge about -- I believe both of them were aware of Mr. Lewis's conviction. we do intend to ask them when they learned that, and the responses or the actions they took in response to learning that. But in general, we don't intend to be repeatedly using the names of those defendants in connection with the fact of their convictions. THE COURT: Well, what I may anticipate is a redacted So

exhibit that relates to the alleged and putative prior felony conviction of codefendant Charles Lewis, and once that has been prepared, then the government will pursue its proffer of not only Government's Exhibit 12030 as redacted, but the similar Lewis exhibit as well. The government will have no objection contemporaneously with the anticipated admission of those redacted exhibits to the court reading to the jury the limiting instruction tendered without any specific designation yet to the court this morning through counsel for Mr. Schmidt.

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And Mr. Lewis asked me to review again his objection with respect to admission of evidence concerning any prior conviction of Mr. Lewis that may have been cabined in docket No. 653, which was addressed, at least in part, by the court's order found at docket No. 676. Mr. Gainor, I am somewhat confused about how the issue remains viable vis-a-vis Mr. Lewis. MR. GAINOR: I apologize, your Honor. I was just

reiterating those motions because my codefendant had mentioned that there was one prior motion. I just wanted the record to be

clear that there were two, and obviously we are not waiving any argument as to those motions. already. And, your Honor, while I was up here, I was also hoping that the court would entertain the fact that if it sees fit, every time Mr. Lewis's name is mentioned on direct examination -- and I guess I can talk to co-counsel during the break whether or not the instruction should be read again. THE COURT: I will take care of that. I will I know your Honor has ruled

respectfully decline to do that.

And the reason I am going to

do that is it will have an anesthetized effect over time, No. 1. And on the other hand, it will call to the jury at every mention the fact that these two men do have convictions, so I am somewhat nonplussed that defense counsel would ask me on a repeated basis to asseverate that fact to the jury, and then try

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to mitigate it with a limiting instruction, which over time is going to lose its effect. So for those reasons, which are essentially defense-oriented, I respectfully decline your request for such a repeated reading. I will read it, of course, contemporaneously, with the admission, if ever, of Government's Exhibit No. 12030 as redacted, and a similarly redacted judgment of conviction relating to Mr. Lewis. And I will entertain, without ruling, the anticipated request by those defendants, at least, to reiterate such an instruction in the court's final charge to the jury. And on that basis we shall now proceed. Very well. There being no further business properly

before the court, we shall be in recess long enough for the jurors, presumably all of whom are present, to be shown into the courtroom, madam clerk. We are in recess. (Recess at 8:35 a.m., until 8:40 a.m.) THE COURT: Good morning, and thank you. Please be

seated, ladies and gentlemen. Very well. gentlemen. THE JURY: THE COURT: Good morning. Again, as I survey the courtroom this A special good morning to you, ladies and

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morning, all those who should and must be present are in fact present and presumably prepared to proceed. Let's find out.

If the government is prepared, they may call their next witness. MR. ANGELO: We are, your Honor. We would call Jerry

Landsman at this time. THE COURT: Thank you. If you will make your way

Mr. Landsman, good morning. forward to be sworn by the court.

To accomplish that, if you

will come and stand in this open area in front of my bench, please. I will be administering the oath, so if you will please

face me and raise your right hand to be sworn, and thank you. May I have your attention in the courtroom. (Jerry Landsman was sworn.) THE WITNESS: THE COURT: witness stand. Again, good morning. THE WITNESS: THE COURT: Good morning. I do, sir. Please be seated in that

Thank you.

As you testify, please use the microphone

in front of you, which by its peculiar design, works best if you will leave a speaking distance of about six to eight inches, please. THE WITNESS: THE COURT: Yes, sir.

Mr. Angelo.

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MR. ANGELO: THE COURT:

Thank you, your Honor. You are welcome. DIRECT EXAMINATION

BY MR. ANGELO: Q A Q A Q Please state your name. My name is Jerry Landsman, Jr. Can you spell your first and last name, please? First name is J-E-R-R-Y. Last name is L-A-N-D-S-M-A-N.

Mr. Landsman, can you tell us, please, in what city and

state you reside? A Q A I reside in Boonseboro, Maryland. Can you tell us, please, what your current employment is? I am the director of fraud operations and collections for

Maryland Individual Workers Insurance Fund. Q A Have you also been employed with that entity? No. Prior to that I was with the St. Paul that became the

USF&G. Q And can you tell us, please, how long you were with USF&G

and St. Paul, combined? A Q Combined a little over nine years. Can you tell us, please, what those periods of employment

were? A Q I went to USF&G in April 1992. When did you leave your employment with the successor St.

Paul company?

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A Q

Jerry Landsman - Direct I believe in March of 2001. And can you tell us what your position and duties entailed

at St. Paul? A Q A My position at St. Paul I was the premium fraud manager. And what were those duties that were associated with that? I basically handle any agent/employee misconduct. My

primary purpose was premium avoidance in the case of insureds who had misstated their payroll or classifications or operations. Q Did you also do investigations related to other aspects of

St. Paul operations? A Yes, sir. I handled the surety investigations for the

headquarters office in Baltimore. Q A Q Are you familiar with the name the Reserve Foundation Trust? Yes, sir, I am. Are you familiar with the name of George Alan Weed and the

Weed Agency? A Q Yes, sir, I am. I want to focus on your activities related to those at the Can you tell us, please, if

end of 1999 and 2000, if I might.

you were asked to do anything with relation to the Reserve Foundation Trust or George Alan Weed? A Q A Yes, sir, I was. Can you tell us what you were asked to do? In late September of 1999, I was asked to conduct an

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Jerry Landsman - Direct investigation in response to information that had been received from the state of Iowa. Q Okay. And did, as part of your investigation, did you

receive a package of information from the state of Iowa? A Q Yes, sir, I did. And do you recall what that information from the standpoint

of documents was? A I believe the information contained a letter of

representation from Mr. Weed, and contained information about the Reserve Foundation Trust. document. Q I think there was one other

I can't recall what it was.

Do you recall receiving any contract documents from the

state of Iowa? A Q A placement document, I believe it was. Okay. If I can ask the courtroom clerk to pull up

previously admitted Exhibit No. 43 for the witness. If you look at the tab, please, and open it to 43, Mr. Landsman. A Q Yes. Mr. Landsman, do you recognize that document as something

like or identical to the document that you were provided by the state of Iowa? A Yes, sir. It is either exact or very, very similar,

especially the portion marked Walker White Product Placement Agreement.

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Jerry Landsman - Direct MR. ANGELO: Your Honor, can I ask that the exhibit be pulled up for the jury's reference at this time? THE COURT: BY MR. ANGELO: Q Now, Mr. Landsman, on your review of this specific document, You may. Thank you.

did you in fact identify any areas of concern from your standpoint? A Q A Yes, sir. And what were those? The primary concern was the fact that a representation had

been made that the St. Paul company was providing surety coverage for individual investors for the entity under the Reserve Foundation Trust on a depository bond. Q Looking at, if I can, the first -- or the paragraph noted as Do you see that?

surety or security. A Q Yes, sir, I do.

The document states that the initial principal is one Did your

hundred percent bonded by an insurance company.

company have a bond concerning the principal of an investor's investment? A Q No, sir, we did not. Now, you also explained some concerns about access to the Explain what those concerns were.

St. Paul bond. A

The representation had apparently been made that the

individual investors in this Reserve Foundation Trust --

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Jerry Landsman - Direct MR. BORNSTEIN: Objection, your Honor, to how we would know what representations were made. THE COURT: Personal knowledge under 602.

Your response. MR. ANGELO: THE COURT: may proceed. BY MR. ANGELO: Q Mr. Landsman, just tell us, if you would, please, what was Your Honor, I will rephrase the question. The objection for now is sustained, and you

your understanding of the coverage afforded under the terms and conditions of the bond? A The depository bond is a very limited bond. It covers only

the deposit made in the specific bank.

In the event that the

bank fails, the bond stands in the place and returns the money to the individual that made the deposit that holds the account. Q Okay. If we can ask that we take a look now at Exhibit No.

46, please. MR. ANGELO: And, your Honor, I would ask that exhibit

be shown to the jury at this time. THE COURT: BY MR. ANGELO: Q Now, if you would, please, Mr. Landsman, attached to Exhibit Thank you. It may.

the face page of Exhibit 46 you will find, I believe, another document which is noted as a certificate? A Yes, sir. Have you found that?

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Q

Jerry Landsman - Direct If we can focus on the certificate, please.

Thank you.

Mr. Landsman, as part of the packet you received from the state of Iowa, did you in fact receive a certificate similar to or identical to the one being shown at this time as part of Exhibit No. 46? A Q Yes, sir, I did. Did you have additional concerns about the contents of this

document? A Q A Yes, sir, I did. What were those? They were multiple concerns. One is the fact that Mr. Weed

was represented as an authorized agent of the St. Paul, and in fact he is not. No. 2 is this certificate makes the representation that an individual, in this case Gordon Hulbert, his Social Security number, the individual's deposit is insured by the sole obligatory depositor bond and obviously that is not the case. And the third is the issue of the St. Paul logo in the upper left-hand corner, and the St. Paul logo in line 4 of the document. Mr. Weed obviously has no authority for the Reserve

Foundation to use those logos. Q Now, as a result of receiving that package, can you tell us,

please, whether you conducted an investigation? A Q Yes, sir, I did. And can you tell us, please, generally what that entailed?

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A

Jerry Landsman - Direct The general investigation was to determine, A, how the bond

came to be written, the circumstances around that, and what Mr. Weed's involvement was with the issuance of that bond, with the issuance of certificates. The investigation actually ended with -- I actually spoke to Mr. Weed on several occasions and met him in person, and spoke to other individuals with the Reserve Foundation Trust. Q As part of your investigation, did you do any research as to

whether or not in fact Mr. Weed was an authorized agent? A Q A Yes, sir. It is that what you based your previous answer on? Yes. He was neither an authorized agent for USF&G nor St.

Paul. Q Now, did you in fact have a phone conversation with Mr. Weed

on or about January 5th, 2000? A Q A Q A Q A Q A Yes, sir, I did. Where did you obtain the number to reach Mr. Weed from? I don't recall. I am assuming it was from Iowa.

Did you also have documents from your company? I did have the underwriting file. Was Mr. Weed's stationery contained in that file? Yes, sir. Did you call the number on that stationery? Yes, sir. Actually, Rosemary Quinn of our surety department

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Jerry Landsman - Direct and I called together. Q A Q And was that phone answered Weed Agency, if you recall? I don't recall. Were you able to get somebody on the phone who identified

themselves to you as Mr. Weed? A Q A Q Yes, sir, I did. Did you identify yourself to Mr. Weed? Yes, sir, I did. And did he appear to know, during the course of your

conversation with him, what you folks were addressing with him? A There was no question Mr. Weed fully understood our

conversation. Q A Q A Now, did you explain to Mr. Weed your concerns at that time? Yes, sir, I did. And specifically, what did you tell him? I told Mr. Weed that the representations he made were That he had misrepresented the purpose of the That he is not an authorized agent of the St. Had no

totally improper. depository bond.

Paul, had no authority to represent himself as such. authority to use the St. Paul logo.

And that our position was

that the investors had been misled into believing the depository bond covered their investment. Q Did you at that time ask for a list of the investors from

Mr. Weed? A Yes, sir, I did.

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Q A

Jerry Landsman - Direct And what was your purpose in asking for that? We thought it was important to let the investors know as

early as possible that their investment was in fact not covered by the St. Paul depository bond, the St. Paul held no obligation under that bond, other than to return the bank funds to the account holder in the event that the bank failed. Q Now, did you arrange to meet with Mr. Weed personally at

some point? A Q Yes, sir. I went to see Mr. Weed the following week.

And in the meantime, did he provide you with any

documentation as part of your conversation with him on January the 5th? A He had provided us with a list of the individuals. The

information was very similar to what we already had. Q Did he also provide you with any, for instance,

correspondence or with attachments concerning his communications with investors? A Q Yes, sir. He did provide us with a copy of the letter.

If you would take a look at Government's Exhibit No. 60,

Mr. Landsman. A Q Yes. Take a minute to look at that and the attached documents, if You may pull those out of the sleeve if you

you would, please. need to. A Yes, sir.

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Q

Jerry Landsman - Direct First of all, do you recognize now the letter dated

January 6th that you had in front of you marked as Government's Exhibit No. 60? A Q Yes. This was the fax letter I received from Mr. Weed.

Do you recognize the two pages of attachments to Exhibit No.

60 as something that was also received from Mr. Weed? A Q Yes, sir, I do. Now, looking at those two pages of attachments -MR. ANGELO: Well, first of all, I would move for the

admission of Exhibit 60, your Honor. THE COURT: defendants? Government's Exhibit 60 for identification admitted in evidence, with leave to publish. BY MR. ANGELO: Q Mr. Landsman, if you take a look, please, at the attachment, Any objection by any one or more of the

the first of which is a letter dated December 30th of 1999. Take a moment to read that to yourself, please, and I would ask that that be published at this time, your Honor. THE COURT: It may. Thank you.

THE WITNESS: BY MR. ANGELO: Q

Yes, sir.

Was there anything in the content of that letter that was of

concern to you? A This just reinforced our concerns we already had and makes

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Jerry Landsman - Direct the representation to, in this case, IAMB, that their individual deposit is insured by the St. Paul and insured in the individual's name and tax identification number, which is required by St. Paul Insurance Company, makes reference to the depository bond and to a commercial crime policy, neither one of which is applicable to the individual investor. MR. BORNSTEIN: opinion. I object, your Honor. That's his

I will object to the opinion testimony. THE COURT: MR. ANGELO: Response. Your Honor, I think he is expressing his He has not been qualified as an

knowledge about the policy.

expert and we are not propounding him as an expert. THE COURT: Well, there is going to have to be an

adequate basis for his testimony about what you represent to be a fact based on his employment in this industry or in -- with this company. That is missing, and for now the objection is sustained on the basis of foundation. MR. ANGELO: Thank you, your Honor. We will undertake

to do that at this time. BY MR. ANGELO: Q Mr. Landsman, are you familiar with both the commercial

crime policies issued in the name of the Reserve Foundation Trust and the sole obligee depository bond issued to that entity?

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A Q

Jerry Landsman - Direct Yes, sir, I was. Were you familiar with the terms and conditions of those

documents? A Q Yes, sir, I was. And by virtue of your association with the company and

experience, as well as your knowledge of the contents of those documents, were you familiar and did you know about what coverages are afforded and to whom? A Q Yes, sir, I did. Now, with respect to again Government's Exhibit No. 60,

looking at that document, looking at the paragraph which is closer to the bottom, where it starts, to insure accurate accountability. would. A Q Yes, sir. Was in fact St. Paul maintaining a copy of each wire Take a second and read that to yourself if you

transfer? A Q No, sir. There would be no reason for us to do that.

And did you find out -- or find anything misleading about

this particular statement? A Q A Certainly. What was that? This gives, these investors, gives them the impression that

St. Paul has -MR. BORNSTEIN: Objection to what somebody else's

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Jerry Landsman - Direct impression will or will not be. MR. ANGELO: THE COURT: I will rephrase it, your Honor. For now the objection is sustained.

You may rephrase. BY MR. ANGELO: Q A What impression did it give you, Mr. Landsman? It gave me the impression that if I had been in receipt of

this, that my individual deposit would have been insured by St. Paul and St. Paul would have maintained a record of that transaction and would have issued a trust certificate for my investment. Q Was St. Paul doing any monitoring of these particular wire

transfers? A Q No, sir. Now, Mr. Landsman, as a result of your conversation with

Mr. Weed on January 5th, did you endeavor then to communicate with investors that had been identified to you? A Q Yes, sir, I did. Would you please take a look at what's been marked for

identification as Government's Exhibit No. 48 in the notebook in front of you. MR. ANGELO: And, your Honor, as a previously admitted

exhibit, we would ask that it be displayed and published at this time. THE COURT: It may. Thank you.

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Jerry Landsman - Direct THE WITNESS: Yes, sir. BY MR. ANGELO: Q A Q A Q Do you recognize Exhibit 48? Yes, sir. Did you author that document? Yes, sir, I did. And can you tell us, please, how it was distributed and to

whom, generally speaking? A For each of the investors that I was able to identify, I

sent this letter either by Airborne Express, fax, or certified reserve -- certified mail to make sure they received it. Q And your purpose in communicating with those investors

through that letter is what? A Prudent to let these folks know that their estimate was not

insured by the St. Paul, that we had no obligation to them, and that their understanding may have been incorrect. Q Now, you indicated that you had set up a meeting with

Mr. Weed to occur the following week? A Q A Q A Q A Yes, sir. And where did that meeting take place? In Mr. Weed's office. And where was that located? I believe it's Benton, Illinois. Can you describe the office for us, please? It's a very small retail space on the square of Benton,

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Jerry Landsman - Direct 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Illinois. Q And can you give us an idea about the number of people

working there at the time you were there? A Q I believe I saw two, Mr. Weed and one other. Did you address again, personally at that time, your

concerns with Mr. Weed? A Q Yes, sir, I did. Can you tell us, please, and describe for us that

conversation? A I was very, very blunt with Mr. Weed, and reiterated our

conversation of the 5th, and explained to him, A, he had no authorization to act as an authorized agent of St. Paul, and that the representations on the depository bond were incorrect, and he was ordered once again to cease and desist. Q With respect to your assertion to him that he was not an

authorized agent of St. Paul, what was his reaction? MR. BORNSTEIN: from Mr. Weed. MR. ANGELO: It's a statement of this particular Objects to the hearsay, your Honor,

defendant, your Honor. THE COURT: This is not hearsay as defined by The objection is noted but overruled.

801(d)(2)(A) and (E).

Sir, you may answer counsel's last question on two conditions. No. 1, that after the exchange you recall the

question, and if you do, that you can answer his question of

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Jerry Landsman - Direct your personal knowledge. Do you recall his question? THE WITNESS: MR. ANGELO: BY MR. ANGELO: Q When you told Mr. Weed or said to Mr. Weed that he was not No, sir. Would you please repeat it.

I will do so.

an authorized agent of St. Paul, what was his response to you? A Q A Q Mr. Weed had no explanation. Did he argue with you about that? No, sir, he did not. Did you discuss with him your concern about the use of St.

Paul's logo on the certificates of insurance? A Q A Q Yes, sir, I did. And can you tell us, please, what his response to that was? He had no response. Did you talk about with him about whether the certificates

or how the certificates had been used and when they had been sent out, first of all? A Q A Yes, sir, I did. And what did he say to you? His explanation was that he sent the certificates out upon

receiving information that deposit had been made to a specific bank, and the money had been placed. out with a copy of certificate. Q And in discussing those certificates with him, did he He sent a direct letter

indicate to you whether in fact he had sent a copy of these to

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Jerry Landsman - Direct the St. Paul office in Des Moines, Iowa? A He indicated he had sent a copy to the St. Paul after

several had been sent. Q A I am sorry. I didn't understand you.

I said he had sent a copy to the St. Paul after several had

already been sent out. Q A Q To investors? Yes. Prior to going to the meeting with Mr. Weed, had you

attempted to ascertain the balance in the CIBC account that was held in the name of the Reserve Foundation Trust in the Caribbean? A Q Yes, sir, I did. And at the time that you contacted Mr. Weed, did you ask him

for an updated client list? A Q Yes, sir, I did. And at that time did you ask Mr. Weed what he thought the

account balance was in that bank? A Q A Yes, sir, I did. And what did he tell you? He told me he believed the account balance to be roughly

6.8 million. Q And did you tell him what the balance was as you had

confirmed prior to your interview? MR. BORNSTEIN: Objection, your Honor. Foundation.

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Jerry Landsman - Direct Source of that information must be hearsay. THE COURT: That's not the thrust of the question. So

the objection is overruled. BY MR. ANGELO: Q Did you tell Mr. Weed what you had discovered about the

balance in the CIBC account prior to your traveling to Benton? A Q Yes, sir, I did. And what did you tell him? MR. BORNSTEIN: Now I object to the fact that the

source of that information comes from hearsay. THE COURT: the proffer. Doesn't matter. That's not the thrust of It is --

It's not being offered for the truth.

this is a part of this conversation.

It could be that he was

lying to the -- lying to Mr. Weed, trying to trick him, but it's not being offered for the truth, and that makes it non hearsay. The objection is overruled. Again, sir, you may answer on my two preconditions, the first of which is again, do you recall counsel's last question? THE WITNESS: BY MR. ANGELO: Q Sure. What did you tell Mr. Weed the balance in the CIBC Could you please repeat it.

account was as of the date of your visit with him? A Q A I told Mr. Weed the balance was approximately $323,000. Can you tell us, please, what his reaction to that? Mr. Weed's exact words were, I guess I am really in trouble.

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Q

Jerry Landsman - Direct Now, at the time of your visit to Mr. Weed, did he provide

you with additional copies of correspondence that he had been sending to investors? A Q Yes, sir, he did. I am going to ask you to take a look at Exhibit No. 61 as in Do you

your notebook, and you may remove that from the sleeve. recognize that document? A Q A Q A Yes, sir, I do. And how do you recognize it?

This was received from Mr. Weed on the 11th of January. Do you recognize any of the handwriting on the document? Actually, handwriting where it says, received, the date is

mine. Q A Q Okay. What about the number at the top that's handwritten?

I don't recognize the handwriting. Okay. Now, with respect to this letterhead, did you

recognize the name on it? A Q A Q Yes, sir. And the name on the top of the letterhead is what? The Reserve Foundation Trust. And what did Mr. Weed explain to you about this particular

piece of correspondence when he delivered it to you? A Mr. Weed advised me that upon receipt of my last

correspondence on January 6th, Mr. Harte was very concerned about the investors' reaction to my letter and had spoken with

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Jerry Landsman - Direct Mr. Weed and asked him to send this letter out.

It was

Mr. Weed's explanation that Mr. Harte had dictated this letter to him, and he had sent it out to all the investors in response to my letter of January 6th. MR. ANGELO: Your Honor, we would move for the

admission of Government's Exhibit No. 61. THE COURT: defendants? MR. BORNSTEIN: THE COURT: granted. MR. BORNSTEIN: podium. THE COURT: Thank you. EXAMINATION BY MR. BORNSTEIN: Q A Q A Q If you look at page 3 of the exhibit, please? Yes, sir. Do you see a signature on the bottom of page 3? Yes, sir, I do. Is it your understanding that signature is Alan Weed's You may operate from there if you choose. And I can do it from here or go to the Voir dire question or two, your Honor. Any objection by any one or more of the

Limited to authenticity only, leave is

signature and not Leon Harte's signature? A I have no idea whose signature it is, sir. It says Leon

Harte with a dash.

I can only go by the explanation I was given

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Jerry Landsman - Direct as to how it was sent. Q And the explanation would tell you that it was Alan Weed's

signature, would it not? A No, sir it would not. Mr. Alan Weed authored the document.

It wouldn't tell me who signed it. Q A So you don't know who signed it? That's correct. MR. BORNSTEIN: No further questions. Now I object to

the document, your Honor. THE COURT: On what basis? On the basis that he has no knowledge

MR. BORNSTEIN:

as to the author of the document. THE COURT: He has the statement by Mr. Weed that it That's all

was dictated to him by Mr. Harte and he sent it out. the foundational predicate that is necessary. cross-examination and weight to be assigned.

All else is for

That objection is noted but respectfully overruled. Others by any other codefendants? Hearing none,

Government's Exhibit 61 for identification admitted in evidence, with leave to publish. MR. ANGELO: Thank you, your Honor. We would ask that

the document be published at this time. BY MR. ANGELO: Q Mr. Landsman, if you would turn to the second page of Looking at that large

Government's Exhibit No. 61, please.

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Jerry Landsman - Direct paragraph in the middle of the page, would you take a minute to read that. A Q Yes, sir. Do you see the sentence there, and I quote, He sends the

certificate information to me and to the St. Paul Fire & Marine Insurance Company to register you and your deposit as a settler beneficiary of the Reserve Foundation trust? A Q A Q Yes, sir. Was St. Paul registering investors? No, sir. Now, as a result of your visit to and with Mr. Weed on the

11th of January, did you author a letter addressed to Leon Harte? A Q A Q A Q A Sir, I believe I did. If you take a look at Government's Exhibit No. 62, please. Yes, sir. Do you recognize that document? Yes, sir. What is it? It's a letter I sent on the 13th of January, again to

Mr. Weed on the 11th, sent to Mr. Harte as the manager of the Reserve Foundation Trust. Q A What was the purpose of sending that letter to Mr. Harte? I wanted to make sure there was no question as to the St.

Paul's position over the depository bond, and to let him know

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Jerry Landsman - Direct that we were further clarifying the position and letting him know that we had notified all the investors, and we ordered Mr. Weed to cease and desist. Q And how did you get the address for Mr. Harte, if you

recall? A Q I believe it was given to us by Mr. Weed. And did you provide a copy of that letter to Mr. Weed as

well? A Yes, sir, I did. MR. ANGELO: Your Honor, I move for the admission of

Government's Exhibit No. 62 at this time. THE COURT: defendants? Hearing none, Government's Exhibit 62 for identification admitted in evidence, with leave to publish. MR. ANGELO: time, your Honor. THE COURT: BY MR. ANGELO: Q Mr. Landsman, if you take a look at the last sentence in Thank you. We would ask that it be published at this Any objection by any one or more of the

that letter, which states, Well, I believe our position is clear. Please feel free to contact me if you have any Did you in fact receive a communication in response

questions.

to that invitation by telephone? A I actually spoke with Mr. Harte or to an individual who

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Jerry Landsman - Direct represented themselves as Mr. Harte and Mr. Schmidt. Q A Q And when did that take place? Several days after this letter, I believe. And at the time that you spoke with him, who initiated that

phone call? A Q A Q A I believe they did. And had you provided Mr. Weed with your contact number? Yes, sir, I had. And was that also on your letterhead? The letterhead, it was on my business card, and obviously on

any fax transmission. Q And during the course of your conversation with the persons

who purported to be Mr. Harte and Mr. Schmidt, did they appear to have some knowledge of your communications with Mr. Weed? A They were fully aware of our conversations and

correspondence. Q A Q Now, was this phone call to you a surprise? Yes, sir, it was. Can you describe the conversation that you had with these

gentlemen? A It was not all that I expected. I again reiterated to them There didn't seem

the same facts as I communicated to Mr. Weed.

to be any question about understanding the purpose of the depository bond, the fact that Mr. Weed was not an authorized agent of St. Paul, that there was no protection for the

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Jerry Landsman - Direct individual investors, and in fact, I discussed the purported balance in the account of the CIBC. At no point was the

conversation confrontational, argumentative or anything of that nature. Q It was very, yes, we understand.

Well, first of all, let's talk a little bit about how these

people represented themselves to be associated with the Reserve Foundation? A They claimed to be managers -MR. BORNSTEIN: Your Honor, I will object unless we can

have some differentiation between what one person said versus another. MR. ANGELO: THE COURT: I will endeavor to do so, your Honor. The form of the question is objectionable.

Sustained for now. Mr. Angelo, your next question. MR. ANGELO: BY MR. ANGELO: Q Can you tell us, please, who did most of the talking from Thank you, your Honor.

the other side during your conversation? A Q I don't recall whether it was Mr. Schmidt or Mr. Harte. Do you remember who told you that they were both managers of

the Reserve Foundation Trust? A Q I believe that was Mr. Harte. And when you told them the purported bank balance, did one

or both of them have a response to you about where those funds

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Jerry Landsman - Direct 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 had gone? A Q A Q A Yes, sir, they did. And who responded? Mr. Harte, I think. And what did Mr. Harte tell you? Mr. Harte indicated $5.5 million had been transmitted to the

Barclays Bank. Q A Q A Q Barclays Bank? B-A-R-C-L-A-Y. And was Mr. Schmidt on the line at that time? Yes, sir. And what is the effect on the coverage of the depository Can you spell that for us, please?

bond once those funds are moved from the CIBC bank? A The depositor fund covers only those funds remaining in the So, for instance, the $6.8 million had been the

account.

initial deposit, $5.5 million had been taken out, we would then be responsible on the depositor bond for the difference of 1.3 million. Q Now, if you can, did you endeavor to follow up that

telephonic communication by letter? A Q A Q Actually, I made several efforts to do that. Okay. Describe those efforts for us, please.

First I sent a letter to the address that they had provided. And can you tell us -- if you take a look at Government's

Exhibit No. 64, please.

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Jerry Landsman - Direct 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A Q A Q A Yes, sir. Do you recognize that document? Yes, sir. What is it? It's the letter I sent after our conversation with Mr. Harte

and Mr. Schmidt. Q And the letter -- the address on the letter, where did you

obtain that from? A Q A Q A Q A From correspondence previously from their foundation trust. And did you understand this to be Mr. Schmidt's address? Yes, sir, I did. From whom? From Mr. Schmidt. And the general topic of this letter is what? Just memorializing our conversation, making sure there was

no -- there could be absolutely no question about what St. Paul's position was. MR. ANGELO: Your Honor, at this time we move for

admission of Government's Exhibit No. 64. THE COURT: defendants? Hearing none, Government's Exhibit 64 for identification admitted in evidence, with leave to publish. MR. ANGELO: your Honor. We would ask it be published at this time, Any objection by any one or more of the

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Jerry Landsman - Direct THE COURT: Thank you. BY MR. ANGELO: Q Mr. Landsman, I would like to refer you to the last Can you tell us,

paragraph of Government's Exhibit No. 64.

please, what your purpose was in requesting confirmation on Reserve Foundation letterhead of the receipt of your letter? A It was just to further protect the St. Paul companies and

make sure that everyone was aware of our position. Q A Q And did you receive that? No, sir, I did not. And did you make an effort to follow up on that particular

issue? A Q A Actually, I made several efforts, sir. Can you describe those efforts for us, please? I actually called Mr. Schmidt, the number he provided. I

asked for confirmation. letter. letter.

He claimed not to have received the I re-faxed the Followed up with

He provided a fax number for me. Still didn't receive a response.

several following calls. Q A Q

I never did receive a response.

Did you attempt to contact Mr. Harte? Yes, I did. Did he have an explanation for the fact that the letter had

not been -- or the request for response had not been sent? A Q No, sir, he did not. Did you ever receive a written response as requested?

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A Q

Jerry Landsman - Direct Not as of today, sir. At the time of your conversation with Mr. Weed on the 11th

of January, did you in fact give him a direction to cease and desist certain activities orally? A I gave him an oral cease and desist on the 5th, and gave him

a written and oral one on the 11th. Q And looking at Government's Exhibit No. 63, if you would, Do you recognize that document?

please. A Q A Q A Q A

Yes, sir. Is that a document authored by you? Yes, sir, it is. And sent to whom? Mr. Weed. And the purpose of that specific communication was what? Just another follow-up to make sure that Mr. Weed understood

that, A, he had to place his carrier on notice, and he was to cease and desist any representations for solicitation on behalf of the St. Paul company. MR. ANGELO: Your Honor, at this time we move for the

admission of Government's Exhibit No. 63. THE COURT: defendants? Hearing none, Government's Exhibit 63 for identification admitted in evidence, with leave to publish. MR. ANGELO: Please, your Honor. Any objection by any one or more of the

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Jerry Landsman - Direct THE COURT: Thank you. BY MR. ANGELO: Q Mr. Landsman, can you tell us, please, how long it has been

since you have seen George Alan Weed? A I have only seen Mr. Weed one time. It was January 11th of

2000. Q A Do you think you would recognize him today if you saw him? No, I don't. MR. ANGELO: your Honor. THE COURT: Mr. O'Donnell. CROSS-EXAMINATION BY MR. O'DONNELL: Q A Q Good morning, sir. Good morning. I represent Mr. Smith. The beginning of your testimony you Cross-examination for Mr. Smith, I have no other questions at this time,

mentioned who you worked for. A Q A Q A Yes, sir. And it was not St. Paul? That's correct. How does that work? Who exactly do you work for?

I work for the state of Maryland Individual Workers

Insurance Fund. Q At this time?

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Jerry Landsman - Cross 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A Q A Q A Q A Q A Q Yes, sir. What about this time when you were doing this work? When I did this work I worked for the St. Paul companies. Oh, you did? Yes, sir. And it was a -- by contract or was it a direct employment? It was direct employment position. And does St. Paul have a division of fraud? They did at the time, yes, sir. Okay. The division there, um, is it a part of the state or

federal government? A Q A Q A Q No, sir. No? No, sir. So it would be a private corporation division? Yes, sir. Then if you issue a cease and desist, is it -- I take it not

published by any state or federal agency? A Q That's correct. And I notice that in the voluminous papers we have been

delivered that your correspondence went to also the state securities division in Illinois? A Q A I believe it's in Iowa, sir. Excuse me. And the Secretary of State?

I believe it's just the one office.

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Q A

Jerry Landsman - Cross And tell us exactly what office it was? I believe my correspondence was copied to Erica Brown at the

Iowa Securities Division. Q Okay. And did you send a copy of your cease and desist to

that agency? A Q I don't recall, sir. Well, as a matter of fact, in reviewing the record, it would

show, wouldn't it, that you did not? A I don't recall, sir. If it's not a cc on my letter then it

would not have been sent. Q Okay. Then -- and you made no contact with the FBI,

apparently? A Q A Q A That's incorrect, sir. And you made contact? Yes, sir, I did. And could you tell us all about that? Yes. Actually, my first contact was with an agent I had I don't recall his name. I contacted

worked with previously. him.

He told me the resident agent was who was covering Benton, I spoke to that agent at length about the

Illinois.

investigation, and at some point a referral to them. Q A What do you mean? I made a referral to them. I sent them a letter outlining

the investigation. Q Did you send them a copy of your cease and desist?

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A Q A Q A Q

Jerry Landsman - Cross They actually received a narrative report. A narrative report? Yes, sir. But not the cease and desist? I don't believe they ever received that. Isn't it true, sir, that the FBI did nothing? They did not

publish that at all? A I have no idea. MR. GOODREID: part of this witness. THE COURT: 602 personal knowledge is implicated. Objection. Calls for speculation on the

Without that foundational information, for now the objection is sustained. MR. O'DONNELL: BY MR. O'DONNELL: Q And I take it you do not know, and that's your answer. Is I will withdraw the question.

that correct? A Q That's correct, sir. Okay. With regard to your statements to and documents

delivered to Mr. Weed, was there any duty on his part to publish, say, or to do anything with them? MR. ANGELO: Objection. Foundation. Calls for speculation again. I can only sustain

MR. GOODREID: THE COURT:

Objection.

Foundation times two.

the objections once, which I do.

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Jerry Landsman - Cross MR. O'DONNELL: Thank you, Judge. BY MR. O'DONNELL: Q A Q Did you tell him to publish what you gave him? No, sir. Okay. With regard to his license in the state of Illinois,

isn't it true, sir, that all that you did -- you never bothered to communicate to the licensing division of the state of Illinois? A Q A I did not make any referrals to the state licensing bureau. I did not understand you. I said I did not make any referrals to the state licensing

bureau. Q Okay. And are you aware, or would it surprise you that in

2005, Mr. Weed was still an authorized licensed insurance agent from the state of Illinois? MR. ANGELO: THE COURT: Objection, your Honor, as to relevance. Response? I will tie that up with Defendant

MR. O'DONNELL:

Smith's Exhibit 6, your Honor, which will be produced during his testimony. THE COURT: Reply. This is an implied request for the

court to admit this conditionally under Rule 104(b), subject to it being tied up later. MR. O'DONNELL: MR. ANGELO: Yes. That's what I had in mind, Judge.

Your Honor, the question was directed

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Jerry Landsman - Cross towards the year 2005, which is beyond the scope of any of the dates that are at issue here. THE COURT: Response to that objection, which focuses

on the temporal nature of the question. MR. O'DONNELL: Your Honor, the testimony will be that How I am going

from -- should I say this in front of the jury? to connect it? THE COURT:

Maybe won't be the right answer. Your Honor, all this is, I promise to

MR. O'DONNELL:

connect it relevantly within the terms and the time of the indictment in this case. THE COURT: Very well. We are spending more time on it

than it is probably worth, at least for now. Based on the representations of counsel as an officer of the court, we will admit this conditionally, subject to it being tied up later under Rule 104(b). MR. O'DONNELL: And that would be defendant Smith's My numbers are a

Exhibit 6, which is -- oh, excuse me, 12. little off. 12, Judge.

THE COURT:

Your next question of this witness, if any. Oh, all right.

MR. O'DONNELL: BY MR. O'DONNELL: Q

When you talked to the securities division in Iowa, did

they -- and did you with them make a plan of attack to stamp out this fraud?

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A

No, sir.

Jerry Landsman - Cross Our investigations were separate and did not blend

at all.

In fact, Ms. Brown from the securities division

wouldn't discuss the nature of their investigation with me. Other than to say the information they provided to me at that point. She did not discuss the nature of what they were going

to do or how they were going to do it, nor did I discuss her with what we were going to do, other than to tell her I would keep her posted on what actions we took. Q A What actions did you take? I gave Mr. Weed a cease and desist, clearly outlined the Made

limitations of the depository bond and the crime policy.

sure to the best of our ability that all investors we were able to identify were aware of the limitations, and made sure that Mr. Schmidt and Mr. Harte were also aware. Q A Q And did you ask them to publish that in any way? No, sir, I did not. And what about your contact with the FBI? Did you make a

plan with them to stamp out this problem? A Q A Q I made a referral, sir. That's all I can do with the FBI.

Do you know what they did? No, sir, I don't. And for St. Paul, isn't it true that after all of your

involvement ended, or shortly before it ended, you knew that Mr. Weed was still an insurance agent in Minnesota going about his business as he desired?

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A Q A

Jerry Landsman - Cross A, Mr. Weed was not in Minnesota. Illinois, yes.

He was in Illinois.

I had no idea what Mr. Weed was doing.

My last

correspondence and conversation with Mr. Weed was in January of 2000. Q A Q A Who replaced you? I have no idea, sir. Then you wouldn't know if they did anything? That's correct. I would not. No further questions.

MR. O'DONNELL: THE COURT:

Cross-examination of this witness on behalf

of Mr. Lewis, Mr. Gainor. MR. GAINOR: THE COURT: Thank you, your Honor. You are welcome. CROSS-EXAMINATION BY MR. GAINOR: Q A Q Mr. Landsman, good morning. Good morning. If I understand your testimony correctly, you had contact

with Norman Schmidt? A Q A Q A Yes, sir. Mr. Weed? Yes. And Mr. Harte? Yes.

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Q A Q A Q A

Jerry Landsman - Cross Never came in contact with Charles Lewis? I am not familiar with that name, sir. You sent letters out to investors on one occasion? Two occasions, sir. What were those dates? I believe the first date was January 6th, and I believe the

second was the 13th. Q A Q A Q A Of January as well? Yes, sir. And there was no other follow-up after this period? Not by me, no, sir. Anyone else in your department? Not that I am aware of, sir. MR. GAINOR: THE COURT: Thank you. Cross-examination of this witness on behalf

of Mr. Weed, Mr. Goodreid? MR. GOODREID: THE COURT: Yes. Thank you, your Honor.

You are welcome. CROSS-EXAMINATION

BY MR. GOODREID: Q A Q Good morning, Mr. Landsman. Good morning. Let me begin by clarifying a couple of things you said on If we could pull up Government's Exhibit

direct examination. 43, please.

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A Q

Jerry Landsman - Cross If you would take a look at it there, Mr. Landsman. Yes, sir. Do you recall the prosecutor asking you questions about that

document? A Q Yes, sir. If you would take a look -- and I hope we have this in front If you focus on the same paragraph that Do you see the paragraph called

of the jury as well.

Mr. Angelo asked you about. security? A Q Yes, sir.

Now, it says, does it not, the initial principal is hundred

percent bonded by Safeco, RLI, or other acceptable surety carrier? A Q A Q Yes, sir. It does not mention St. Paul by name, does it? No, sir, it does not. And as far as you know, this document was not issued by

Mr. Weed, was it? A Q A Q No, sir. I don't know who it was issued by.

Have you take a look at the second page of that document. Yes, sir. Do you see at the bottom, you see a date at the bottom,

Mr. Landsman? A Q Appears to be 8/14 of '99. So August of '99?

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Jerry Landsman - Cross 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A Q Yes, sir. That's a date prior to St. Paul having issued the sole

obligor depository bond in this case; isn't that right? A Q I believe that's correct, yes, sir. All right. We are done with that exhibit, Mr. Landsman.

Now, again, you conducted an investigation of this entire matter involving Mr. Weed and the St. Paul certificates and these letters, correct? A Q That's correct. And you determined he was not an authorized agent of St.

Paul, right? A Q That's correct. In fact, your conclusion was actually broader than that; You concluded that he did not even have any

isn't that right?

authority to conduct business on behalf of the St. Paul, right? A I concluded he had no authority to act as a representative

of St. Paul. Q You also concluded he had no authority to conduct business;

isn't that right? A Q That's correct. Now, you know, do you not, that in June of 1999 Mr. Weed

sold on behalf of St. Paul a sole obligor depository bond to an entity called DWD-1? A Q That's correct. And he did that despite the fact that he had no authority to

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Jerry Landsman - Cross do business on behalf of St. Paul, right? A He brokered that piece of business through another agent,

sir. Q A Q A Q All right. He was a licensed insurance broker, correct?

I assume so, correct. He recruited the customer, right? That's correct. In fact, in that particular case he collected the premium;

isn't that right? A Q I assume so. Same situation with Reserve Foundation Trust, he collected

the premium, right? A Q A Q I assume so. And he obtained the customer? I don't know who obtained the customer. You don't know. You investigated this matter over what

period of time? A Q About eight weeks, sir. Do you have any reason to believe that anybody other than

Mr. Weed recruited the Reserve Foundation Trust as a customer of that policy? A My understanding was the Reserve Foundation Trust came to It wasn't a recruitment. It was brought to him by

Mr. Weed.

somebody else. Q It wasn't collected by Iowa Bankers, was it?

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A Q

Jerry Landsman - Cross Not to my knowledge, no, sir. He also brought Reserve Foundation Trust the St. Paul

Insurance Company for purposes of sale for commercial crime policy; isn't that right? A Q That's correct, sir. So we just talked about three policies, right? The surety

bond to Reserve Foundation Trust, the commercial crime policy to Reserve Foundation Trust, and the surety bond to DWD-1, correct? A Q A Q Depository bond, that's correct, yes, sir. Depository bond? That's right. In none of those instances was Mr. Weed authorized to

conduct business on behalf of St. Paul, right? A Q Not as an individual, that's correct, sir. Now, when you investigated this matter, you talked to the

St. Paul people involved, didn't you? A Q A Q A Q A Q 18. Yes, sir, I did. Talked to Mr. Kesselring? Yes, sir. Talked to Mr. Bailey? Yes, sir. Talked to Ms. Woodbury? I believe I did, yes, sir. Let me ask you to take a look at defendant Weed's Exhibit Mr. Landsman, it's actually a different book.

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Jerry Landsman - Cross MR. GOODREID: And your Honor, that's already been admitted in evidence. THE COURT: BY MR. GOODREID: Q I would like you to focus, Mr. Landsman, when you find that May it also be shown to the jury as well? And it may.

Thank you.

on the first page of that document. A Q Okay. You see at the top where it says -- first the date is

October 1st, 1999, right? A Q Yes. And would you agree that during that time frame

approximately Mr. Weed was involved through the St. Paul getting a commercial crime policy and a sole obligor depository bond approximately fall of 1999? A Q Yes, sir. Do you see the next line that says, dear St. Paul's agents

and brokers? A Q Yes, sir. Do you know of any reason why the St. Paul Insurance Company

would have sent this document to Mr. Weed in the fall of 1999? A The only explanation I have, sir, is either he brokered a This is a

piece of business through a licensed St. Paul agent.

blanket mailing that would have gone to every agent, anyone that would have brokered a piece of business. Q Right. It's a document that says, dear St. Paul agents and

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Jerry Landsman - Cross brokers, right? A Q That's the title, yes, sir. But according to you, Mr. Weed was not authorized even to do

business on behalf of St. Paul, right? A As an individual he was not authorized to do business for

the St. Paul, that's correct. Q Now, you also learned during your investigation, did you

not, that in November of 1999 Mr. Weed had sent a blank copy of the insurance certificate to the St. Paul company, right? A Q He sent a copy of a c