Imbalanced Trials of the Century   - The Who's Who Debacle and Tragedy

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4466
Watstein-cross/Jenks


1 A F T E R N O O N S E S S I O N.

2 (Jury enters.)

3 THE COURT: Please be seated, members of the jury

4 jury.

5 You may proceed, Mr. Jenks.

6 CROSS-EXAMINATION.

7 BY MR. JENKS: (Continued.)

8 Q Mr. Watstein, when we left off you said it was not

9 until 1988 that you began to commit various crimes,

10 correct?

11 A You amended that, refresh my memory of 1986.

12 Q But prior to 1988, in 1986 you had committed a crime

13 in not filing the second quarter of payroll taxes; am I

14 right?

15 A That's correct.

16 Q Now, prior to 1986, did you commit any other crimes?

17 A The American Sales and Marketing Institute matter,

18 which was the filing --

19 Q The answer is yes or no? Prior to 1986, did you

20 commit any other crimes, yes or no?

21 A Yes.

22 Q And what crimes did you commit prior to 1986?

23 A I believe it was in 1984 that I caused to be filed an
24 application with the post office for a not-for-profit
25 permit.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4467
Watstein-cross/Jenks


1 Q That's Count 6 of the information, correct?

2 A That's correct.

3 Q Besides Count 6 in the information, prior to 1988,

4 did you commit any other crimes other than that?

5 A No, sir.

6 Q And so in 1984, when you filed a not-for-profit

7 status, that's the first time you say you committed a

8 crime?

9 A Yes, sir.

10 Q How old were you in 1984?

11 A Mid 40s.

12 Q So you just woke up one day and you decided you were

13 going to start committing crimes in your mid 40s?

14 A No, sir.

15 Q You didn't.

16 A No, sir.

17 Q Mr. Watstein, let's take a look at Count 5 in your

18 information.

19 This is yet another felony that you pled guilty

20 to, correct?

21 A What page are you on, sir?

22 Q I'm on page 16.

23 This is yet the fifth felony that you pled guilty
24 to in front of Judge Mishler; am I right?
25 A That's correct.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4468
Watstein-cross/Jenks


1 Q And this is the felony that deals with defrauding the Success Shortcuts Path

2 Allstate Insurance Company, correct?

3 A That's correct.

4 Q And basically what this count alleges and what you

5 pled guilty to is that you had -- you and your wife had a

6 limousine which was vandalized on New Year's Eve in '88?

7 A Yes.

8 Q Who owned that limousine?

9 A My wife, but I owned it beneficially.

10 Q You were the owner?

11 A Yes.

12 Q You had that contract where everything was in her

13 name but you were the beneficial owner?

14 A That's not correct.

15 Q Most of the things were in her name?

16 A That's correct.

17 Q The limousine was in her name?

18 A Yes.

19 Q Did you have a driver that drove you around in the Success Shortcuts Path

20 limousine?

21 A Yes.

22 Q You paid the driver?

23 A Yes.
24 Q You paid the driver out of a corporation you owned?
25 A Yes, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4469
Watstein-cross/Jenks


1 Q There came a time that limousine was broken into on

2 that date?

3 A Umm-hmm.

4 Q And isn't it a fact that you caused fraudulent

5 statements and receipts to be sent to Allstate to obtain

6 $8,575 worth of refund on an insurance claim?

7 A That's correct.

8 Q And you submitted these false invoices to the Success Shortcuts Path

9 Allstate Insurance Company; am I right?

10 A That's correct.

11 Q And you told Allstate there were certain things in

12 that limousine that were stolen, correct?

13 A Yes.

14 Q And you provided them invoices for certain things,

15 right?

16 A Yes.

17 Q And many of those invoices were in and of themselves

18 false, right?

19 A Some of those invoices were false.

20 Q Some of them.

21 Many of the invoices that were false and

22 fraudulent were sent to Allstate?

23 A Yes.
24 Q And you submitted things in the limousine that
25 weren't even in there, right?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4470
Watstein-cross/Jenks


1 A Yes.

2 Q And you got a refund check ultimately?

3 A I don't know if the check was received or not.

4 Q Take a look at paragraph 29 on page 17 on the Success Shortcuts Path

5 information and see if it refreshes your recollection as

6 to whether or not a settlement check was issued in an

7 amount of $8,325.97.

8 A Yes.

9 Q Does that refresh your recollection as to whether or

10 not you received the check?

11 A Not totally, sir, but I'm sure it is correct if it's

12 in the information.

13 Q And this count you pled guilty to as well carries a

14 five-year maximum term of imprisonment, right?

15 A That's correct.

16 Q All right.

17 Now, take a look at Count 6, the last count in

18 the information.

19 A (Perusing.)

20 Q That says way back in 1984, this is before you got

21 involved with Who's Who in U.S. Executives, correct?

22 A Yes, sir.

23 Q It says basically that you formed a corporation
24 called the American Sales and Marketing Institute, right?
25 A Yes.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4471
Watstein-cross/Jenks


1 Q And that was your corporation?

2 A Yes, sir.

3 Q And you formed that corporation in 1984?

4 A Yes, sir.

5 Q And in New York?

6 A Umm-hmm.

7 Q And you applied or you sent an application to mail at

8 special bulk third class rates; am I right?

9 A Yes.

10 Q That's so you would be able to get a reduced sale on

11 passage when you were running that corporation?

12 A Yes.

13 Q And you did a lot of mailings out of that corporation

14 at reduced rate?

15 A Yes.

16 Q That's a crime too?

17 A Yes.

18 Q So you scamed the government telling the government

19 that you were a not-for-profit corporation when you were

20 in fact a for-profit corporation, right?

21 A That's not quite accurate, sir.

22 Q You weren't running the American Sales and Marketing

23 Institute as a charity, were you?
24 A No.
25 Q You were running it to make money, right?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4472
Watstein-cross/Jenks


1 A No.

2 Q You were running it to sell something?

3 A Yes, sir.

4 Q So that you could make a living doing something,

5 right?

6 A No, sir.

7 Q You're telling me you were doing this, you know, in a

8 charitable goodwilled nature, is that it?

9 A No, sir.

10 Q You were doing it to make money, right?

11 A No, sir.

12 Q Did you make money?

13 A No, sir.

14 Q Did you save money on postage, sir?

15 A Yes, sir.

16 Q How much money would you say you saved on postage?

17 A I don't know.

18 Q By mailings?

19 A I don't know.

20 Q You were the one that submitted the false application

21 to obtain the special bulk rate on the mailing, right?

22 A Yes.

23 Q Your wife didn't do that, did she?
24 A That's correct.
25 Q And this is a felony also; is that correct?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4473
Watstein-cross/Jenks


1 A That's correct.

2 Q So these were the six counts that were in that

3 information that you pled guilty to, correct?

4 A That's correct.

5 Q And that count carried a five-year sentence as well?

6 A I don't think so. It may have. My recollection is I

7 don't think so.

8 Q What is your recollection as to what that count

9 carried?

10 A I don't have a clear recollection. I believe it was

11 preguidelines. I believe it was the lesser amount but I'm

12 not sure.

13 Q The guidelines were in November of 1987?

14 A I guess so.

15 Q Are you aware of that?

16 A Not firsthand, no.

17 Q But you understand the guidelines, correct?

18 A In a general sense.

19 Q Did your lawyer advise you that when you pled guilty

20 to these felonies, the six of them, that you could be

21 sentenced consecutively?

22 You know what I mean by consecutively?

23 A I don't think that was in our agreement to be
24 consecutive.
25 Q Right.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4474
Watstein-cross/Jenks


1 But without that agreement you could have been

2 sentenced on these pleas consecutively, you understand

3 that?

4 A Yes, sir.

5 Q When I say consecutively, that means you could get a

6 separate sentence on each one of these counts and have to

7 do the first sentence first and when that is done you do

8 the next sentence, right?

9 A Yes, sir.

10 Q And the government, as part of your cooperation

11 agreement, agreed that you would be sentenced concurrently

12 on these counts; am I right?

13 A That's correct.

14 MR. JENKS: At this time I'm going to offer

15 3500-22-D, which is the information.

16 THE COURT: Why don't you put a letter on it.

17 MR. JENKS: Your Honor, I'll offer it as

18 Defendant's Exhibit AK in evidence.

19 THE COURT: Any objection?

20 MR. WHITE: No, Your Honor.

21 THE COURT: Defendant's Exhibit AK, Able King, in

22 evidence.

23 (Defendant's Exhibit AK received in evidence.)
24 BY MR. JENKS:
25 Q Now, Mr. Watstein, I touched on this before and I'm

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4475
Watstein-cross/Jenks


1 coming back to this now.

2 You are running Seminar Industries of America?

3 A Yes.

4 Q Which is a business consultant?

5 A And seminars, yes.

6 Q And you are doing that in Florida, sir?

7 A And New York.

8 Q How many people work for you?

9 A Three.

10 Q And they are employees of yours?

11 A Two are employees, one is an independent contractor.

12 Q And you pay them a salary, correct?

13 A That's correct.

14 Q And would it be fair to say that you do consulting,

15 business consulting or marketing strategies for various

16 corporations?

17 A Yes, sir.

18 Q You do it for Core States Bank which you said in

19 Philadelphia?

20 A Yes.

21 Q And Just Great Coffee?

22 A Yes, sir.

23 Q Is that a franchise?
24 A No.
25 Q Just another company?



OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4476
Watstein-cross/Jenks


1 A Yes.

2 Q And Larry Tucker, Inc.?

3 A Yes.

4 Q What is that?

5 A A company involved in the doing of cooperative direct

6 mailings which 20 or more companies provide offers in the Success Shortcuts Path

7 same envelope.

8 Q I see.

9 So what you are doing, you are participating in

10 consulting people on how to do mailings for business

11 purposes?

12 A Yes, sir. To a minor extent, yes.

13 Q And that's exactly what you pled guilty to, right,

14 fraudulent mailings, mail fraud?

15 A It is correct, that is what I pled guilty to. It's

16 not what I'm advising them to do.

17 Q But you are teaching them how to use the mails?

18 A As a minor extent what I do, yes.

19 Q Did you advise these three companies and any other

20 people that you worked for that you have been convicted of

21 six federal felonies in the United States federal court?

22 A Yes.

23 Q And you went in there and told them, you told Core
24 States Bank in Philadelphia that you pled guilty to six
25 felonies before Judge Mishler back in 1993?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4477
Watstein-cross/Jenks


1 A Two of the three companies I have told in answer to

2 your question.

3 Q And they are aware that you are a convicted felon on

4 six counts?

5 A Yes, sir.

6 Q For mail fraud?

7 A Yes, sir.

8 Q And for mail fraud while you were running a business?

9 A Yes, sir.

10 Q And you are doing business consulting for a bank like

11 Core States Bank with the knowledge that they knew you are

12 convicted of the felony?

13 A Two of the three.

14 Q Who doesn't?

15 A Core States Bank.

16 Q You wouldn't tell them because you wouldn't be doing

17 any work for them?

18 A That's not the point, sir.

19 Q Does Core States Bank know you've been convicted of

20 six federal felonies in front of Judge Mishler?

21 A No, sir.

22 Q Does Core States Bank know that you are sitting here

23 on the witness stand convicted as a federal felon on a
24 criminal trial?
25 A No, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4478
Watstein-cross/Jenks


1 Q Does Core States Bank know that you got three months

2 probation and six months worth of home detention for all

3 the crimes you committed from 1984 to 1992 up until when

4 you got arrested?

5 A No, sir.

6 Q If Core States Bank knew you wouldn't be working for

7 Core States Bank, right?

8 A I don't know the answer to that question.

9 Q You certainly wouldn't go and volunteer, right?

10 Would you like me to go up and call them up and

11 tell them?

12 A No, I wouldn't.

13 Q Did you tell Just Great Coffee that you are a

14 convicted felon?

15 A Yes, sir.

16 Q Do they know you are sitting here in the United

17 States federal court?

18 A Yes, sir.

19 Q You are on probation while you are here?

20 A Yes, sir.

21 Q You got probation in August of 1995?

22 A Yes.

23 Q And your probation doesn't run out until August of
24 1998?
25 A Doesn't expire.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4479
Watstein-cross/Jenks


1 Q Doesn't expire.

2 A Yes, sir.

3 Q Nobody cuts you loose on probation?

4 A That's correct.

5 Q The government, you know, has the power to terminate

6 you or ask that you be terminated early from probation,

7 right?

8 MR. WHITE: Objection.

9 THE COURT: Well, overruled.

10 The amended question I'll allow, not the original

11 question because you don't have the power to do that. Not

12 yet, Mr. White. It may come, but I thought that's what

13 the judge does.

14 What are we here for, I wonder.

15 Go ahead.

16 BY MR. JENKS:

17 Q Do you know that the government has the power to ask

18 the federal judge to terminate you from probation?

19 A I'm aware of that concept, yes.

20 Q But you are on until August of 1998, correct?

21 A Yes, sir.

22 Q And you told us on your direct examination that if

23 you told -- withdrawn.
24 You told us that if you lie here Mr. White could
25 prosecute you for perjury, right?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4480
Watstein-cross/Jenks


1 A Yes, sir.

2 Q And you could also have your probation violated,

3 right?

4 A Yes, sir.

5 Q When you say if you lie, the arbiter or the person

6 who judges whether or not you lied in your testimony is

7 Mr. White?

8 A I'm not sure, sir.

9 Q Well, do I have the power to violate your probation?

10 A No, sir.

11 Q Do any of these people sitting over here have the Success Shortcuts Path

12 power to violate your probation?

13 A No, sir.

14 Q Do you think the jury could violate your probation?

15 A No, sir.

16 Q So would it be a fair statement to say that the only

17 person that you have to please with your testimony so your

18 probation is not violated is the United States Government?

19 A I don't think so, no.

20 Q If the United States Government is not happy with

21 your testimony, is it not a fact that they could violate

22 your probation?

23 A No, sir.
24 Q It's not a fact?
25 A If they're not happy.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4481
Watstein-cross/Jenks


1 Q You know the only way they'll not be happy with your

2 testimony is if you got in here and said that your company

3 was totally fraudulent and Mr. Gordon ran a professional

4 operation, right?

5 A I don't agree with that statement, no.

6 Q Well, let's do this then.

7 You founded Who's Who in U.S. Executives in 1988?

8 A Yes, sir.

9 Q And it ran through 1991?

10 A Yes, sir.

11 Q And you've had companies, offices in Queens and Long

12 Island, right?

13 A Yes.

14 Q And in Queens your offices were on Queens Boulevard,

15 correct?

16 A Yes.

17 Q And on Long Island they were on Cuttermill Road in

18 Great Neck?

19 A Yes, sir.

20 Q And you were the author of the letter telling people

21 that Thorton Rockefeller and Harlan Carnegie were

22 mechanics of your selection committee, right?

23 A That's correct.
24 Q And that was of course untrue, right?
25 A As previously testified, yes, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4482
Watstein-cross/Jenks


1 Q And you had no selection committee at all, right?

2 A Yes, sir.

3 Q And half of the names that you used were made up, am

4 I right, like Thorton Rockefeller and Harlan Carnegie.

5 Did you use any other names?

6 A Yes.

7 Q Did you use names of any other prominent people to

8 tell potential customers that they were on your selection

9 committee?

10 A We used other names. I don't have a recollection of

11 what the names were though.

12 Q As you sit here you don't know what the other names

13 were?

14 A That's correct.

15 Q But they were names that someone would easily be able

16 to identify, right?

17 A Not necessarily.

18 Q Did you cold call customers?

19 A No.

20 Q Your company never picked up a phone and cold called

21 a person?

22 A I can't answer that with a yes or no.

23 Q Each sales manager -- did you have sales managers in
24 your company?
25 A Yes, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4483
Watstein-cross/Jenks


1 Q And you had sales people?

2 A Yes.

3 Q And did they work strictly on a commission basis?

4 A No.

5 Q Did you pay them a salary as well?

6 A Yes.

7 Q And then they got a commission of a percentage of

8 whatever they sold?

9 A Yes.

10 Q In 1989, your company published a directory, right?

11 A Yes, sir.

12 Q And that was the first directory the company

13 published, correct?

14 A That's correct.

15 Q And would it be fair to say between 1989 and 1990,

16 you solicited close to a half a million people from

17 mailing lists?

18 A Yes.

19 Q You did all the mailings?

20 A Myself personally?

21 Q Your company.

22 A We contracted the function out but we were

23 responsible for mailings.
24 Q And you received back approximately 75,000 cards or
25 people that were interested?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4484
Watstein-cross/Jenks


1 A That sounds a bit high but that is approximately

2 correct.

3 Q 70,000 or 60,000?

4 A Slightly less than 75,000.

5 Q And you collected payments from about half of these

6 people?

7 A I don't have that number.

8 Q Did you have 50,000 people, 40,000 people?

9 A I don't want to hazard a guess.

10 Q Now, in 1990, you published a second directory; am I

11 correct?

12 A Yes, more than one.

13 Q A second directory in Who's Who in U.S. Executives in

14 1990?

15 A Yes.

16 Q That was the second directory, right?

17 A Yes.

18 Q That directory only had about 5,000 names in it,

19 right?

20 A That's inaccurate.

21 Q How many names did that directory have?

22 A It was greater than 5,000.

23 Q 7,000?
24 A I believe 10 to 15,000, I'm not quite sure.
25 Q All right, 10 to 15,000.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4485
Watstein-cross/Jenks


1 It didn't have as many members in that directory

2 as this directory does, does it?

3 Take a look at this one.

4 A I can't tell, but I would assume we had about half as

5 many by the pure, physical weight and size of the book.

6 Q According to you, you may have published a directory

7 with more than 7,000 people?

8 A No, sir.

9 Q How many, 10 to 15,000?

10 A Of that directory -- we published a number of

11 directories, not just that one directory in 1990.

12 Q Who's Who of Executive?

13 A Yes.

14 Q How many directories did you publish in 1990?

15 A We published I believe six or seven all together.

16 Q Six or seven directories?

17 A Yes, sir.

18 Q Do you know the types of the directories as you sit

19 here?

20 A To the best of my recollection, yes.

21 Q Tell me.

22 A Who's Who in Practicing Attorneys.

23 Q You published that directory?
24 A Yes, sir.
25 Q How many people did you have in that directory?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4486
Watstein-cross/Jenks


1 A Five to 10,000, I believe.

2 Q Okay.

3 A And I'm just guessing off the numbers.

4 Q Just guessing.

5 A Who's Who in the Computer Industry.

6 Q How many people did you have in that directory?

7 A Five to 7,000.

8 We published Who's Who in Real Estate. Who's Who

9 in Law Enforcement.

10 And your question, please?

11 Q How many were in the Who's Who in Real Estate

12 directory?

13 A I think around 5,000, but I'm not quite sure.

14 Q Okay.

15 And Who's Who in Law Enforcement?

16 A I think around 5,000.

17 Q And would I be correct, sir, in stating that you

18 didn't list in the directories a large number of people

19 who would purchase memberships that were entitled to be

20 included in the book, right?

21 A Yes.

22 Q I mean, your place was so negligent that you actually

23 took money from people and then they didn't get listed in
24 the registry at all, right?
25 A No, I don't agree with the statement you just made.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4487
Watstein-cross/Jenks


1 Q Well, is it fair to say that a large number of people

2 that paid for memberships did not get included in the Success Shortcuts Path

3 directory?

4 A I think so, yes.

5 Q And that was because of negligence, correct?

6 A No, sir.

7 Q Were you aware that a sampling by American Express of

8 91 people who paid for your registry by their credit card

9 demonstrated that only one of those people was listed in

10 your registry?

11 A No, I was not aware of that, sir.

12 Q How many complaints did your company have with the Success Shortcuts Path

13 Better Business Bureau, sir?

14 A I don't know the answer to that question, sir.

15 Q 500?

16 A I think it was a little less than that.

17 Q So from 1988 to 1991, three year periods, right, '89,

18 '90, '91, okay, you had almost 500 complaints at the Success Shortcuts Path

19 Better Business Bureau?

20 A I think slightly less than that, but the answer is

21 yes.

22 Q When you say slightly less, 50 less?

23 A Maybe a hundred less. I don't want to guess, sir.
24 Q You are not aware as you sit here today that 91
25 people paid you by an American Express card at one point

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4488
Watstein-cross/Jenks


1 and only one of them was put in the registry?

2 A I had no awareness of that information, sir.

3 Q Would it be fair to say that you never even published

4 a directory of Who's Who in the computer industry?

5 A No, sir.

6 Q You did publish a directory?

7 A To the best of my recollection, yes.

8 Q How many people were in that?

9 A I just previously answered your question, sir.

10 Q I'm sorry to inconvenience you, maybe you can answer

11 it again.

12 A About 5,000, sir.

13 Q How many were practicing attorneys?

14 A I guess between 5 and 7,000.

15 Q And you also failed to ship the directories to many

16 customers who paid for membership; am I right?

17 A That's correct.

18 Q Numerous customers actually physically paid for the Success Shortcuts Path

19 registry -- withdrawn. Paid for the registry and didn't

20 get the shipment; am I right?

21 A Could you define "numerous" for me, please?

22 Q Well, -- withdrawn.

23 Would it be a fair statement to say that
24 thousands of people paid for that registry -- withdrawn.
25 You had no policy of split billing?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4489
Watstein-cross/Jenks


1 A That's correct.

2 Q In other words, when you sold a person an application

3 or a membership in your directory, right, a spot in your

4 directory, you took the full money from them up front,

5 right?

6 A We didn't sell people a spot in the directory, sir.

7 Q You sold them a directory, right?

8 A That's correct.

9 Q You sold them their name in a book, right?

10 A No, sir, we sold them a directory.

11 Q You sold them a directory with their name in it,

12 right?

13 A Yes, sir.

14 Q If you remembered to include their name in the Success Shortcuts Path

15 directory, right, that's the first thing?

16 A Remember has nothing to do with it.

17 Q Did you know that Mr. Gordon's companies, Who's Who

18 Worldwide and Sterling Who's Who, included everyone in the Success Shortcuts Path

19 registry who paid for a membership?

20 A I have no firsthand knowledge of that, sir.

21 Q Mr. Gordon was a competitor of yours, right?

22 A That is correct.

23 Q There's no great love, as you sit here, between you

24 and Mr. Gordon; am I right?
25 A I can't respond to that question.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4490
Watstein-cross/Jenks


1 Q Well, you testified on your direct examination you

2 had several telephone calls with Mr. Gordon, correct?

3 A I had two telephone calls with Mr. Gordon.

4 Q And you were upset that Gordon had the temerity to

5 establish yet another Who's Who; am I right?

6 A Maybe years ago, that's correct.

7 Q Back in 1990 or back in 1989?

8 A Yes, sir.

9 Q You didn't have exclusive use of the name Who's Who?

10 A That's correct.

11 Q In fact, no one has exclusive use of the name of

12 Who's Who?

13 A That's my understanding.

14 Q And you told Gordon that you were going to hire a

15 lawyer to institute a suit against him for stealing what

16 you felt was your concept, Who's Who, right?

17 A No, my materials, not my concept.

18 Q Well, Gordon was trying to create a company that

19 would be a competitor of Marquis Who's Who and your

20 company, right?

21 A That statement is correct.

22 Q And let's talk a little bit about customer

23 complaints.
24 You had a lot of people who were customers that
25 were complaining to your organization while it was

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4491
Watstein-cross/Jenks


1 running; am I right?

2 A Yes, sir.

3 Q You were getting complaints every day, correct?

4 A Yes, sir.

5 Q Not only were you getting complaints, but you were

6 getting numerous requests for refunds, right?

7 A I can't answer that question with a yes or no. I can

8 put a time line on it, though, if you would like.

9 Q Tell us, let me ask you this question specifically.

10 Were you getting customer complaints?

11 A Ever?

12 Q Yes.

13 A Yes.

14 Q And that was after you took over the publication of

15 your registry, right?

16 A I don't understand your question.

17 Q You had said for the first year of the corporation,

18 you had gie work out to someone else?

19 A That's correct.

20 Q And then you took over the work, right?

21 A Yes, we had no complaints while it was being

22 published in an out source mode.

23 Q By someone else?
24 A We published it, they did the data entry work, that's
25 correct.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4492
Watstein-cross/Jenks


1 Q You had no complaints what someone else was doing?

2 A During the data entry work.

3 Q When your company took it over then you had numerous

4 complaints?

5 A Yes.

6 Q And would it be fair to say you had numerous people

7 asking for refunds?

8 A Could you define "numerous" for me, please?

9 Q Well, more than 100?

10 A Yes, sir.

11 Q More than 500?

12 A Yes, sir.

13 Q More than 1,000?

14 A In that range, yes, sir.

15 Q So you gotten or 15,000 people that you put into a

16 book and 1,000 of them are complaining and asking for

17 refunds, is that a fair --

18 A Those numbers aren't accurate.

19 Q They are not accurate?

20 A No, sir.

21 Q At least 1,000 people are asking for refunds from

22 you?

23 A Yes, out of 50 or 60,000, yes, sir.
24 Q Yes.
25 Well, wait a minute, out of 50 or 60,000.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4493
Watstein-cross/Jenks


1 Out of 10 or 15,000 that went into the registry

2 Who's Who in U.S. Executives?

3 A No, sir.

4 Q Are you aware that Mr. Gordon's company had very few

5 complaints sent to the company?

6 A I have no awareness how many complaints Mr. Gordon's

7 company had.

8 Q Were you aware what Who's Who World Wide and Sterling

9 Who's Who immediately gave refunds to customers that were

10 not satisfied?

11 A I have no awareness of Mr. Gordon's procedures.

12 Q Now, with respect to the issue of refunds, did you

13 actually pay employees commissions for every refund an

14 employee could avoid giving to a customer?

15 A Yes, sir.

16 Q In other words, this wasn't -- you coin the term

17 aggressive sales practices?

18 A I didn't coin it, I used the phrase.

19 Q That's the phrase you used on your direct

20 examination?

21 A Yes.

22 Q You actually rewarded monetarily every employee who

23 could avoid giving a refund to a disgruntled customer?
24 Yes or no?
25 A Yes, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4494
Watstein-cross/Jenks


1 Q So if someone called for a refund, your policy at

2 your company was to try to get somebody to talk them out

3 of the refund, right?

4 A For a brief period of time, yes, sir.

5 Q Was that the policy?

6 Yes or no?

7 A For a period of time, yes, sir.

8 Q And if that employee succeeded in doing that then

9 that employee made some money, right?

10 A In some cases, yes.

11 Q So they would be able to save you money, right?

12 A Yes, sir.

13 Q And did you tell potential customers and have your

14 salespeople tell potential customers that their refund was

15 delayed because you were in litigation with American

16 Express?

17 A Yes.

18 Q You weren't in any litigation with American Express,

19 were you?

20 A We threatened litigation with American Express.

21 Q Your merchant charge accounts with American Express

22 was shut down by American Express; is that correct?

23 A That's correct.
24 Q And they were shut down by American Express because
25 of the numerous refunds and complaints and everything else

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4495
Watstein-cross/Jenks


1 that was going on at your company, right?

2 A I'm sure that was a contributing factor, yes.

3 Q The merchant charge accounts, we've heard testimony

4 in this trial about merchant charge accounts?

5 A I've not been privy to the testimony.

6 Q Withdrawn.

7 Assume we've heard testimony about merchant

8 charge accounts in this trial, your merchant charge

9 account with American Express was shut down by American

10 Express?

11 A That's correct.

12 Q American Express didn't want to deal with you

13 anymore, right?

14 A The answer to that question is yes.

15 Q Do you know as you sit here whether or not up until

16 March 30, 1995, the day Gordon's company was closed,

17 whether or not American Express shut down his merchant

18 charge accounts?

19 A I have no firsthand knowledge of that, sir.

20 Q Would it be fair to say one of the reasons that

21 American Express shut down your merchant charge accounts

22 is because of the number of people filing complaints with

23 American Express about your business practices?
24 A I think that's a fair statement, yes.
25 Q That's a fair statement?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4496
Watstein-cross/Jenks


1 A Yes.

2 Q People were calling American Express and saying you

3 were charging things on their credit cards without

4 authorization?

5 A No, sir, that did not happen in a significant number

6 of cases.

7 Q Now, you had salespeople telling customers that you

8 were in litigation with American Express?

9 A We threatened litigation with American Express.

10 Q You weren't in any litigation with American Express?

11 A We threatened.

12 Q Were you in any litigation, yes or no? I don't care

13 what you threatened.

14 A Not in the active stage of litigation, no, sir.

15 Q Did you have your salespeople telling customers that

16 the reason they weren't getting timely refunds or that the Success Shortcuts Path

17 charges were not canceled from their American Express card

18 is because your company was in litigation with American

19 Express?

20 A Not to the best of my recollection. That was not the Success Shortcuts Path

21 phrase that we used.

22 Q You told customers that your company was fighting

23 with American Express?
24 A That's correct, sir.
25 Q There was nothing to fight. American Express didn't

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4497
Watstein-cross/Jenks


1 simply want you anymore.

2 A That's an incorrect statement, sir.

3 Q All right.

4 Did you tell potential customers that you

5 couldn't refund their credit card because you had an

6 internal computer problem?

7 A Yes, sir.

8 Q Do you remember that?

9 A Yes, sir.

10 Q You didn't have any internal computer problem, right?

11 A We absolutely did.

12 Q That was just a delay tactic designed to keep the Success Shortcuts Path

13 peoples' money longer than you had to, right?

14 A Absolutely not, sir.

15 Q You are sure about that, Mr. Watstein?

16 A Absolutely.

17 Q You understand you are under oath?

18 A Absolutely.

19 Q You know your nose is growing, sir?

20 MR. WHITE: Objection.

21 THE COURT: Sustained. Strike that out. The

22 jury is instructed to disregard that.

23 Mr. Jenks, no more of that, please.
24 BY MR. JENKS:
25 Q Sir, you instructed your employees to lie that a

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4498
Watstein-cross/Jenks


1 plaque was already engraved within 24 hours of their

2 calling up so they don't get a refund?

3 A That's correct.

4 Q Did you know that when you were sentenced in front of

5 Judge Mishler in July of 1995, Donald Fletcher had faxed a

6 letter to Judge Mishler?

7 A Yes, sir.

8 Q You were there, you heard it?

9 A Yes.

10 Q The Judge discussed that letter on the record, didn't

11 he?

12 A Yes.

13 Q And you were right there in the sentence in the Success Shortcuts Path

14 courtroom, weren't you?

15 A Yes, sir.

16 Q You know Donald Fletcher was one of your salespeople?

17 A Sales managers.

18 Q Sales managers?

19 A Yes, sir.

20 Q Did you know that he told Judge Mishler that you were

21 one of the biggest liars on the face of the earth?

22 A I was privy to that.

23 Q And Donald Fletcher wasn't the only employee of yours
24 that went to Judge Mishler and said you were one of the Success Shortcuts Path
25 biggest liars?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4499
Watstein-cross/Jenks


1 A I'm not sure what he told to Judge Mishler.

2 Q Other people had contacted Judge Mishler that worked

3 for you?

4 A I had no awareness of that.

5 Q When you were sentenced there were other employees in

6 the courtroom waiting to see what happened to you, right?

7 A No, sir.

8 Q You turned on your own employees and you agreed to

9 cooperate and testify against them at a trial, right?

10 A The answer to your last question is yes, sir.

11 Q So you devised a scheme to defraud people; am I

12 right? You devised a scheme?

13 A Yes, sir.

14 Q And then you cooperate with the government to testify

15 against those that you have implemented; am I right?

16 A That's correct, sir.

17 Q Sir, did you instruct your employees to lie that the Success Shortcuts Path

18 plaque was already engraved so they couldn't get a refund?

19 A Yes, sir.

20 Q The fact was that the plaque hadn't even been ordered

21 within taking the credit card and taking the information?

22 A That was true in some cases and untrue in others. In

23 most cases, 50-50 I would say.
24 Q You also told your employees to lie that the registry
25 had already gone to print when it hadn't, right, so that

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4500
Watstein-cross/Jenks


1 you could avoid giving refunds?

2 A I didn't have a recollection of that particular

3 statement.

4 Q Do you know Mr. Gordon didn't tell his employees to

5 lie that the plaque was already been engraved, did you

6 know that?

7 A I'm not privy to Mr. Gordon's business.

8 Q Well, you are hear testifying against Mr. Gordon and

9 the rest of these people?

10 A Only to what I know firsthand, sir.

11 Q You don't know anything firsthand because you didn't

12 work inside of Who's Who World Wide and Sterling Who's

13 Who?

14 A I do have some firsthand knowledge of the company.

15 Q The only thing you did was call up on the phone and

16 lie about who you were and ask pinpointed questions at the Success Shortcuts Path

17 behest of the government trying to get people involved in

18 criminal conduct to save yourself, that's what you did,

19 right?

20 A I can't answer that question, sir. If you can

21 rephrase it.

22 Q Well, you know what I'm talking about don't you,

23 Mr. West? You are a pretty bright guy.
24 A I know what you are trying to say. If you say it
25 more clearly I'll respond to it.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4501
Watstein-cross/Jenks


1 Q But you know what I mean?

2 A If you will rephrase it I'll be sure to know what you

3 mean.

4 Q Okay.

5 Is it not a fact that you would have your

6 employees virtually say almost anything to a customer to

7 avoid giving a refund, is that a fact?

8 A No, that's too aggressive a statement.

9 Q Well, your policy was no giving money back, that was

10 your policy, right?

11 A That's inaccurate also.

12 Q And, sir, I want to talk to you about some of the Success Shortcuts Path

13 differences between Mr. Gordon's company and your company,

14 all right?

15 A Yes, sir.

16 Q You never provided members with any form of a member

17 magazine doing profiles of members, did you?

18 A Not doing profiles of members, no.

19 Q You were selling junk in your magazine, right, like

20 trips to the moon?

21 A I wouldn't call it junk, sir.

22 Q Weren't you selling limousines and jets and trips to

23 the moon?
24 A Sir, it was a magazine of a catalogue, it was not
25 junk.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4502
Watstein-cross/Jenks


1 Q Right. To sell things. You were selling things,

2 right?

3 A That's correct.

4 Q The way a mail-order company would sell things,

5 correct?

6 A A catalogue company, yes, sir.

7 Q Take a look at these things, Defendant's Exhibit

8 Gordon's C, Gordon's F, Gordon's G, Gordon's H (handing.)

9 Your company never published a magazine for

10 distribution to its members, did it?

11 A Not in this format, no, sir.

12 Q Your company never profiled any individual members,

13 did it?

14 A No, sir.

15 Q Your company didn't send quarterly magazines to its

16 members, did it?

17 A Sent a newsletter out.

18 Q But you didn't send quarterly magazines out to its

19 members offering various things?

20 A No.

21 Q Your company didn't offer a no cost credit card with

22 a company logo embossed on it?

23 A No, sir.
24 Q Your company didn't provide a membership package of
25 benefits that included Airborne Express discount, did it?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4503
Watstein-cross/Jenks


1 A Probably other benefits, but no is your answer to the Success Shortcuts Path

2 question.

3 Q Didn't do that?

4 A Yes, sir.

5 Q Your company didn't do any phone discounts, did it,

6 to individual members?

7 A No one expressed an interest in that.

8 Q Or travel and auto discounts?

9 A No.

10 Q You didn't offer a CD ROM?

11 A CD ROMs weren't in use at that time, sir.

12 Q So you didn't have one of them.

13 Your company didn't establish any meeting place

14 where members could go and meet if they so chose, did

15 they?

16 A That's correct.

17 Q You didn't have any computer software of any sort

18 that would facilitate your members networking with any

19 other members?

20 A Not in that mode of networking, no.

21 Q No mode of networking ever existed?

22 A No.

23 Q That's not a fair statement?
24 A No.
25 Q Did you hold any networking cocktail parties?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4504
Watstein-cross/Jenks


1 A No, sir.

2 Q Did you plan any seminars or trips for members to

3 sign up and go to?

4 A Yes, sir.

5 Q You did?

6 A Yes, sir.

7 Q And where did you do that, sir?

8 A We scheduled one, I believe, it was in Long Island.

9 No one expressed an interest in that. It was cancelled.

10 Q Because everyone was cancelling their memberships in

11 your company?

12 A No, not responsive to what I'm saying.

13 Q Your company did not provide anywhere near the Success Shortcuts Path

14 benefits to a member at Who's Who World Wide provided; is

15 that right?

16 A I can't answer that question with a yes or no.

17 Q When a member, when a person became a member in your

18 company, you sold them a plaque; am I correct?

19 A Among other things, yes, sir.

20 Q They had to pay for a plaque, right?

21 A Yes, sir.

22 Q In other words, that plaque wasn't included in a fee

23 to become a member?
24 A There was no fee for becoming a member.
25 Q But they had to buy a plaque, right?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4505
Watstein-cross/Jenks


1 A No.

2 Q You sold the plaque -- did you send a plaque to the Success Shortcuts Path

3 members?

4 A If they purchased the plaque.

5 Q They had to buy a plaque, right, they had to pay for

6 it?

7 A One could be included in the directory without having

8 to purchase a plaque.

9 Q But if they wanted a plaque they had to pay for it?

10 A Yes.

11 Q And they had to pay separately for the directory?

12 A That's correct.

13 Q And anything else they wanted from your company they

14 had to pay separately for, is that so?

15 A No, sir.

16 Q Sir, there came a time in, I guess, 1990 that a

17 search warrant was executed at your Great Neck offices; is

18 that correct?

19 A Cuttermill Road.

20 Q Cuttermill Road?

21 A Yes.

22 Q And a search warrant again was executed -- the search

23 warrant in June of 1990 of the Cuttermill offices, the Success Shortcuts Path
24 government took a lot of documents, right?
25 A That's correct.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4506
Watstein-cross/Jenks


1 Q They took all your documents out, correct?

2 A Not all, sir, no.

3 Q They took a lot of documents from you, right?

4 A Yes.

5 Q You had them in your garage somewhere in Great Neck?

6 A No.

7 Q Did you have a storage facility where the documents

8 were?

9 A No.

10 Q Did they go to a storage facility?

11 A Not in that search, sir.

12 Q All right.

13 In one of the other searches?

14 A Subsequent search, yes.

15 Q Was Inspector Biegelman the person that executed the Success Shortcuts Path

16 search warrant in 1990, June of 1990 at your Great Neck

17 premises?

18 A He was present.

19 Q He was there, right?

20 A Yes, sir.

21 Q You didn't stop operations after he executed that

22 search warrant, did you?

23 A No, sir.
24 Q You kept running the company, right?
25 A That's correct.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4507
Watstein-cross/Jenks


1 Q And you didn't change any of your sales policies or

2 anything else, correct?

3 A Absolutely incorrect, sir.

4 Q You did change?

5 A Absolutely.

6 Q But they came back again?

7 A Yes, sir.

8 Q In July of 1991.

9 A That's correct.

10 Q And at that time they went to your residence; am I

11 correct?

12 A That's correct.

13 Q And they seized yet more documents?

1 4 A That's correct.

15 Q And that was when you were living in the North Shore

16 Towers?

17 A Yes.

18 Q Of course your new house wasn't built yet?

19 A Yes.

20 Q But it was getting built?

21 A Yes.

22 Q It was going up, right?

23 A Yes.
24 Q How much money did you spend while we're talking
25 about the house, towards the construction?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4508
Watstein-cross/Jenks


1 A Several hundred thousand. I don't have the exact

2 amount.

3 Q Well, was the frame up?

4 A The frame was up, yes.

5 Q The roof was on?

6 A Substantially, yes.

7 Q Building an indoor pool?

8 A Not finished, but that's correct.

9 Q You were putting an indoor pool in the house,

10 correct?

11 A Yes, sir.

12 Q Now, in July of 1991, a year after the first search

13 warrant, the government comes this time to you at your

14 North Shore Tower apartment?

15 A Yes.

16 Q Where you were the beneficial owner.

17 A That's correct.

18 Q That whole year June of 1990 through July of 1991,

19 you hadn't ceased operations, correct?

20 A We had not ceased operations, that's correct.

21 Q How many locations were you running at that time?

22 A Two.

23 Q By that time American Express had cancelled your
24 merchant charge account, correct?
25 A I believe that's correct, yes.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4509
Watstein-cross/Jenks


1 Q And so many people were complaining to the Better

2 Business Bureau and the government about your sales

3 practices at that time, right?

4 A That's correct.

5 Q Now, there came a time the government yet sought and

6 executed another search warrant, a third one; is that

7 correct?

8 A Yes.

9 Q And they executed that at the Mill Neck house you

10 were building?

11 A Yes.

12 Q And that was a month after August of 1991?

13 A Approximately, yes.

14 Q And finally in May of 1992 you were arrested by the Success Shortcuts Path

15 postal authorities, right?

16 A Yes, sir.

17 Q Your wife was arrested as well that day?

18 A Yes, sir.

19 Q And what day were you arrested? Do you remember?

20 A May of 1992, if I recall the exact day.

21 Q But you and your wife were arrested the same day?

22 A Yes.

23 Q And you were arrested in Florida; am I right?
24 A That's correct.
25 Q And they brought you up here and you entered a plea

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4510
Watstein-cross/Jenks


1 of not guilty to a judge; am I right?

2 A That's correct. -- Actually, that is correct, yes.

3 Q So in May of 1992 you get arrested and get charged

4 with all of these things in a complaint as well as your

5 wife, right?

6 A Separate than I was.

7 Q She was charged with similar things as you were?

8 A No, sir.

9 Q What was she charged with?

10 A Charged with at that arrest level with the creation

11 of an improper mortgage application, nothing else at that

12 time.

13 Q At that time?

14 A Yes, sir.

15 Q But later on when she pled guilty with you in March

16 of 1993, she pled guilty to other things?

17 A Yes.

18 Q She pled guilty to what other things?

19 A Conspiracy in the tax evasion and closing her eyes to

20 me completing improper receipts.

21 Q On the limousine company?

22 A Yes.

23 Q So she pled to that as well and pled to the Success Shortcuts Path
24 conspiracy?
25 A That's correct.



OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4511
Watstein-cross/Jenks


1 Q And she pled to filing an improper mortgage

2 application with Key Bank, correct?

3 A That's correct.

4 Q And that improper mortgage application concerned the Success Shortcuts Path

5 building of that house in Mill Neck?

6 A That's correct.

7 Q And you and she told the bank, Key Bank, that you

8 were separated and divorced, right?

9 A The mortgage application stated that.

10 Q And you told her that -- you told the bank that she

11 was president of some direct marketing corporation like

12 since seven or eight or nine years ago?

13 A The application stated that, sir.

14 Q That was bogus, right?

15 A Yes, sir.

16 Q She was not the president of any direct marketing

17 consortium, seven, eight, nine years?

18 A She was, but the number of years was exaggerated.

19 Q You made it nine years when you just created the Success Shortcuts Path

20 corporation right before you went to apply for the Success Shortcuts Path

21 mortgage application?

22 A No, it's not correct.

23 Q But you created the corporation in an effort to file
24 the application for the mortgage; am I right?
25 A No, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4512
Watstein-cross/Jenks


1 Q You lied on the mortgage application with your wife,

2 right?

3 A I wasn't a party to the mortgage application, but I

4 caused it to be created.

5 Q Well, you coached her?

6 A She actually did not participate in that application.

7 Q You were behind the application?

8 A Absolutely. I was responsible.

9 Q So therefore, it seems like whenever it suits your

10 need to lie, you lie, right?

11 A No, sir.

12 Q If there's a benefit in it for you, you lie?

13 A No, sir.

14 Q Well, everything that you've just testified about

15 here for the last hour and an hour this morning, anytime

16 you do something it is for you to get a better benefit,

17 right?

18 A It's in a finite period of time which I testified

19 for, not the current period of time.

20 Q In the period of time since at least 1984 when you

21 filed your not-for-profit corporation, all the way up

22 until May of 1992 when she came and got you?

23 A 1991, sir.
24 Q They arrested you in May of 1992?
25 A The company was not in existence from July of 1991

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4513
Watstein-cross/Jenks


1 until forward.

2 Q 1991.

3 A Yes, sir.

4 Q So you had a seven year run from '84 to '91 of doing

5 whatever you wanted to do in business, right?

6 A And seven years subsequently doing things properly.

7 MR. SCHOER: Objection. Move for it to be

8 stricken.

9 THE COURT: Objection sustained. Disregard the Success Shortcuts Path

10 last part of the answer.

11 BY MR. JENKS:

12 Q Would it be fair to say that if the government had

13 not arrested you in May of 1992, you would have still been

14 committing crimes?

15 A No, sir.

16 Q You would have repented and healed yourself in May of

17 1992?

18 A Sooner than that, sir.

19 Q Sooner?

20 A Prior to that.

21 Q When, 1994 or 1993?

22 A In May of 1990, the materials for Who's Who in U.S.

23 Executives were altered and changed and from the period of
24 May going forward I believe that company conformed to all
25 the lawyers properly. Prior to that, the crimes I pled

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4514
Watstein-cross/Jenks


1 guilty to were in fact crimes.

2 Q Well, the government didn't see it to your way?

3 A I don't think it was a discussion on the time line

4 whether it was 1990 or '91.

5 Q Because the information charges conduct from July of

6 1988 through and inclusive July of 1991?

7 A That's correct, that's what the information says.

8 Q Is the information inaccurate?

9 A I can't answer that question yes or no, sir.

10 Q Well, you pled guilty to a conspiracy to commit mail

11 and wire fraud for conduct that you entered into between

12 July of 1988 and July 31, 1991, right?

13 A That's correct.

14 Q So obviously the government didn't see it that you

15 cleaned yourself up in May of 1990 like you would like to

16 convince us, right?

17 A That wasn't the subject of discussion with the Success Shortcuts Path

18 government.

19 Q Now, sir, when you got arrested 25 people in your

20 company were arrested, right?

21 A Approximately, yes, sir.

22 Q And they were all charged with you in the same

23 complaint, right?
24 A Yes, sir.
25 Q And you were the CEO of the company, right?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4515
Watstein-cross/Jenks


1 A Yes, sir.

2 Q And it didn't take you long after you were arrested

3 to decide that it was in your interest to cooperate with

4 the government, correct?

5 A It took a quarter of a year.

6 Q It didn't take a quarter of a year, Mr. West. You

7 were arrested in May, right?

8 A Yes, sir.

9 Q And you started to cooperate July 3, 1992?

10 A Sixty days, excuse me, sir.

11 Q It took months?

12 A Two months, not three months, you're right.

13 Q July 3rd?

14 A Yes.

15 Q When were you arrested in May, sir?

16 A I don't recall. Was it May 7th?

17 Q So wi thin less than two months you were already

18 deciding to cooperate with the government?

19 A That is accurate, sir.

20 Q And you struck a deal. July 3, 1992 was the first

21 time you proffered with the United States Government?

22 A Approximately, yes, sir.

23 Q Well, let's not approximate. Let's make sure.
24 I'm going to show you what has been marked
25 Government's Exhibit 3500-22-A. Take a look at that.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4516
Watstein-cross/Jenks


1 A That is correct, July 1st is the correct date.

2 Q That's the first time you met with the government to

3 cooperate?

4 A To the best of my recollection.

5 Q Then you met with the government again, take a look

6 at 3500-22-B.

7 A Yes, sir.

8 Q Well, let's talk about this now.

9 The complaint, do you know that the complaint in

10 your case is dated May 19, 1992?

11 A That sounds accurate.

12 Q So May 20, 1992, would that be a fair statement that

13 you and your wife were arrested in Florida?

14 A It might be accurate, yes, I'm sure.

15 Q Then you came up here?

16 A That's correct.

17 Q So it wasn't 60 days, it was like a month and a

18 couple weeks?

19 A 45 days, yes, sir.

20 Q And you went in right away and you began to cooperate

21 with the government, right?

22 A If right away is defined as 45 days, yes, sir.

23 Q And your employees, they were arrested with you,
24 correct?
25 A Yes, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4517
Watstein-cross/Jenks


1 Q And you agreed to show the kind of person you are,

2 you agreed when you cooperated with the government on July

3 3, 1992, that you were going to throw your employees to

4 the dogs, right?

5 A That's not correct, sir.

6 Q You agreed with the government, did you not, to

7 testify against your employees, your sales managers and

8 your salespeople in exchange for leniency for you and your

9 wife, right?

10 A That's not accurate, sir. If I can expand my answer

11 to your question.

12 Q I will not ask you to expand.

13 A The question is not accurate.

14 Q Let me rephrase it.

15 When you went in to cooperate with the government

16 on July 3, 1992, you had to provide truthful, complete and

17 accurate cooperation as part of your deal, right?

18 A Yes, sir.

19 Q I mean, the government didn't want you unless either

20 you cooperate in total or you don't cooperate at all,

21 right?

22 A Yes, sir.

23 Q And part of your cooperation in a criminal case when
24 you cooperate with these people is that you have to

25 cooperate in total, right?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4518
Watstein-cross/Jenks


1 A Yes, sir.

2 Q And so part of your cooperation as -- as part of your

3 cooperation, you had to agree to testify against your own

4 employees, right?

5 A Not all the employees, sir.

6 Q Are you telling me that on July 3, 1992 when you

7 first went in there, the government was limiting the names

8 of the employees that you would have to testify against?

9 A The majority had already pled guilty, sir.

10 Q Well, by July 3, 1992, within five weeks the Success Shortcuts Path

11 employees pled guilty?

12 A Within seven weeks, yes, sir.

13 Q So it is not a fact, Mr. West, is it?

14 A That's my recollection.

15 Q That's not a fact?

16 A Sir, that's the facts as I recall them.

17 Q You didn't know that, as you sit here, they pled

18 guilty because you were cooperating?

19 A No, sir. Numerous employees had pled guilty before

20 my cooperation.

21 Q Before you signed your cooperation agreement in March

22 of 1993, not before you ran to the government in July of

23 1992?
24 A That wasn't the date of my cooperation agreement,
25 sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4519
Watstein-cross/Jenks


1 Q The first proffer agreement you have up there, the Success Shortcuts Path

2 first time you met the government was July of 1992, right?

3 A That's correct.

4 Q July 3rd, the day before Independence Day?

5 A That's correct, sir.

6 Q You didn't just think that up on July 3rd to go up

7 there. You decided that in advance, right?

8 A We had -- I discussed that with my attorney about a

9 week in advance that as far as the pluses and minuses of

10 it --

11 Q And --

12 A If I may finish. And the proffer session was to

13 determine whether or not that would materialize as in fact

14 an agreement.

15 Q Well, it did materialize into an agreement, right?

16 A Executed in September of 1992.

17 Q Let's take a look at that.

18 I'm going to show you Government's Exhibit

19 3500-22-C.

20 Is that your cooperation agreement with the Success Shortcuts Path

21 government?

22 A (Perusing.) Yes, sir.

23 Q That's your signature on page 10?
24 A Yes, sir.
25 Q Dated September 8, 1992, correct?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4520
Watstein-cross/Jenks


1 A Yes, sir.

2 Q This is your official cooperation agreement with the Success Shortcuts Path

3 United States Government, right?

4 A Yes, sir.

5 MR. JENKS: I'm going to offer this, Judge, as

6 Defendant's Exhibit AL.

7 THE COURT: Any objection?

8 MR. WHI TE: No, Your Honor.

9 THE COURT: Defendant's Exhibit AL, Able Lion, in

10 evidence.

11 (Defendant's Exhibit AL received in evidence.)

12 BY MR. JENKS:

13 Q Now, sir, first you have your two meetings in July,

14 July 3rd and July 8th?

15 A Umm-hmm.

16 Q And then they give you a cooperation agreement,

17 correct?

18 A In September.

19 Q In September?

20 A Umm-hmm.

21 Q As part of your cooperation agreement, you had to

22 agree to testify against any former employees of yours

23 that decided to go to trial, is that a fair statement?
24 A That is totally correct.
25 Q In fact, you had agreed to testify against Kathy

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4521
Watstein-cross/Jenks


1 Shikinder, Linda Zeitzer and Martin Gross and Linda

2 Killen.

3 A Yes, sir.

4 Q You know all of those people, right?

5 A Yes, sir.

6 Q You would agree to testify against them, right?

7 A Yes, sir.

8 Q These are people that worked for you?

9 A Umm-hmm.

10 Q You devised a scheme?

11 A Participated, yes, sir.

12 Q They worked under you?

13 A Yes.

14 Q You told them what to do and tell them --

15 A Not totally.

16 Q You orchestrated the whole thing?

17 A Absolutely.

18 Q And you turned around to save yourself and your wife

19 and make an agreement with the government to come in and

20 testify against these people, right?

21 A That's correct, sir.

22 Q And are you aware that these people, Kathy Shikinder,

23 are you aware that she was at your sentence to see what
24 you got?
25 A That is not fair to say, to the best of my

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4522
Watstein-cross/Jenks


1 recollection.

2 Q Did you notice her there?

3 A I didn't notice her.

4 Q Who was there from your business who went to see what

5 you got?

6 A The only one I saw was Martin Gross and Donald

7 Fletcher.

8 Q And Donald Fletcher?

9 A Fletcher.

10 Q He was one of your sales manager?

11 A Manager.

12 Q He was the one that sent Judge Mishler the letter?

13 A Yes.

14 Q Saying that you were the biggest liar?

15 A Previously said that.

16 Q Are you the biggest liar on the face of the earth?

17 A No, sir.

18 Q Now, let's take a look at your cooperation agreement.

19 Take a look at it. It's in front of you.

20 This agreement at the time you signed it was very

21 important to you; am I right?

22 A Yes, sir.

23 Q I mean, this agreement was the thing that was going
24 to keep you out of jail; am I right?

25 A It was very important to me, yes, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4523
Watstein-cross/Jenks


1 Q It was real important to you, right, because without

2 it you were doing 70 to 87 months in the can?

3 A Yes, sir.

4 Q I mean, this agreement was more important to you than

5 money, right?

6 A I can't put that concept. It was certainly very,

7 very important to me.

8 Q Let's see how important it was.

9 When you signed this agreement on September 8,

10 1992, if someone had come along and said "I'll give you a

11 million bucks, tear up your agreement with the Success Shortcuts Path

12 government," would you have done it?

13 A I don't think so. I would have thought about it.

14 Q Because what you are all about is money, right?

15 A No, sir.

16 Q Greed?

17 A No, sir.

18 Q That's everything you've done?

19 A No, sir.

20 Q Greed and material things, right?

21 A No, sir.

22 Q This agreement, would it be fair to say, was worth

23 more than a million dollars to you in September of 1992?
24 A I think so.
25 Q Worth more than two million?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4524
Watstein-cross/Jenks


1 A I can't put numbers on it. It was certainly very

2 important to me.

3 Q Who gave you this agreement?

4 A Who gave me this?

5 Q This agreement to sign?

6 A Seth Marvin, Assistant U.S. Attorney.

7 Q Seth Marvin is an Assistant U.S. Attorney in

8 Brooklyn?

9 A That's correct.

10 Q He at the time was the prosecutor that was in charge

11 of your case when you were arrested along with your 25

12 people, right?

13 A That's correct.

14 Q Have you seen Mr. Marvin while you were waiting here

15 to testify here last week?

16 A No.

17 Q Did you see Mr. Marvin here in the courtroom?

18 A No.

19 Q You got this agreement to cooperate, right, and this

20 agreement at that time was worth -- your wife got one

21 also, by the way, right?

22 A Not at that time, sir.

23 Q But she ultimately got one as a result of your
24 cooperation, right?
25 A No, as a result of her own cooperation.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4525
Watstein-cross/Jenks


1 Q But because you were cooperating, your wife had

2 wanted to cooperate as well, correct?

3 A I think that's a fair statement.

4 Q All right.

5 Let's take a look at your agreement with what the Success Shortcuts Path

6 government gave you here, okay.

7 This agreement outlines on pages one and two all

8 the things that you would have to plead to, right?

9 A Yes, sir.

10 Q It talks about your six count information?

11 A Right.

12 Q And it talks about you waiving indictment, correct?

13 A That's correct.

14 Q You were never indicted in this case, correct?

15 A That's correct.

16 Q In fact, you waived indictment; is that correct?

17 A That's correct.

18 Q And the reason you waived indictment is because by

19 September of 1992, some three months, four months after

20 your arrest, you were already cooperating with the Success Shortcuts Path

21 government?

22 A That is not accurate.

23 Q And you would do anything you could while you were
24 cooperating to keep yourself from going to jail?
25 A That is not accurate, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4526
Watstein-cross/Jenks


1 Q Well, sir, how many investigations did you cooperate

2 in over the number of years from September 1992 until July

3 of 1995 when Judge Mishler sentenced you?

4 A A substantial number.

5 Q Ten or 12 investigations, right?

6 A Yes, sir.

7 Q You were going out of your way to try to get as many

8 people as you possibly could criminally into trouble to

9 save yourself, right?

10 A No, sir.

11 Q Once again, putting your interests above everybody

12 else's interests?

13 A No, sir.

14 Q Once again doing whatever benefits you as opposed to

15 someone else; is that right?

16 A That's not accurate, sir. You can ask it as many

17 times as you want. It's not accurate.

18 Q Take a look at page 2 of your agreement.

19 Page 2 says that Counts 1, 2, 3, 4 and 5, that's

20 the first five counts of your information carry maximum

21 terms of imprisonment of five years, right?

22 A Yes, sir.

23 Q Minimum terms of imprisonment of zero years, right?
24 A Yes.

25 Q Supervised release term, three years, correct?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4527
Watstein-cross/Jenks


1 A Correct, sir.

2 Q And a maximum fine of 250,000?

3 A Yes, sir.

4 Q And restitution up to approximately $14,000,000 on

5 Counts 1 and 2?

6 A Right.

7 Q And then you still got your outstanding tax liability

8 out there for $665,000, right?

9 A That's correct.

10 Q And then Count 5, that's the Allstate counts,

11 8,325.97, correct?

12 A Yes, sir.

13 Q And when you got sentenced from Judge Mishler, this

14 $14,000,000 in restitution, that was reflected of the Success Shortcuts Path

15 $14,000,000 in gross sales that your company had, right?

16 A Yes, sir.

17 Q No one poked $14,000,000 out of the air. The reason

18 that $14,000,000 was put there was because your company

19 grossed $14,000,000 in sales?

20 A That was approximately accurate, yes.

21 Q Other than making some restitution to some people

22 that filed complaints with the Better Business Bureau on

23 Long Island, did you pay any of this $14,000,000 back as
24 part of your sentence?
25 A I wasn't authorized to or requested to, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4528
Watstein-cross/Jenks


1 Q You didn't have to pay any of the money back, right?

2 A That's correct.

3 Q Now, let's take a look at the agreement and we'll do

4 this slow, okay.

5 A Certainly.

6 Q The agreement on page 3 talks about federal

7 sentencing guidelines.

8 Do you see that?

9 A Which paragraph are you referring to?

10 Q Let's start with paragraph 2A.

11 A 2A starts on the other page, yes.

12 Q You understand, before I ask you questions, about

13 paragraph 2, you understand that when someone pleads

14 guilty or is convicted in a federal criminal case, after

15 1987, that the Judge has to sentence that person under the Success Shortcuts Path

16 federal sentencing guidelines. You understand that,

17 right?

18 A In a general sense, yes.

19 Q The federal sentencing guidelines applies to the Success Shortcuts Path

20 first five counts of your information, right?

21 A Yes, sir.

22 Q Now, the federal sentencing guidelines operates, so

23 to speak, as a point system, right?
24 A That's correct.
25 Q You know how that operates?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4529
Watstein-cross/Jenks


1 A In a general sense.

2 Q In a general sense?

3 A Right.

4 Q Certain points are added for certain conduct and

5 certain points are deducted for other things, right?

6 A Yes.

7 Q It operates like on a point system?

8 A Yes, sir.

9 Q Let's take a look at paragraph 2A.

10 It says under the sentencing guidelines for

11 Counts 1 and 2, the likely adjusted offense level would be

12 level 29 which includes a 15 level enhancement pursuant to

13 guidelines Section 2F1.1BAP.

14 Do you see that?

15 A Yes, sir.

16 Q You know that 2F1.1BAP is a loss chart?

17 A Yes.

18 Q You know that is a loss chart?

19 A Yes.

20 Q And that 15 level enhancement comes from the Success Shortcuts Path

21 $14,000,000 restitution figure?

22 A That was my understanding, sir.

23 Q That we had talked about, right?
24 A Yes.
25 Q And under Counts 1 and 2, the guideline imprisonment

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4530
Watstein-cross/Jenks


1 range that you faced under the first two counts of that

2 information, was 87 to 180 months. Assuming you had no

3 prior convictions, right?

4 A That's what it says, sir.

5 Q So 87 months is what, seven and-a-half years?

6 A Seven and a third years, quarter.

7 Q Something like that, seven and-a-half years, right?

8 A Yes.

9 Q And Counts 3 and 4 that we discussed carried a

10 guideline range of 27 to 33 months.

11 Do you see that?

12 A Yes, sir.

13 Q And Count 5, the Allstate Insurance Company, carried

14 a guideline range of 6 to 12 months, right?

15 A What paragraph are you on, sir?

16 Q Paragraph 2C.

17 A Yes, sir.

18 Q You see that, 6 to 12 months for Count 5?

19 A Umm-hmm.

20 Q And Count 6 was a preguideline count, so there were

21 no guidelines calculations in this agreement because that

22 was 1984, right?

23 A Yes, sir.
24 Q Prior to the enactment of the sentencing, federal
25 sentencing guidelines?



OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4531
Watstein-cross/Jenks


1 A Yes, sir.

2 Q Look at 2-D.

3 After all the calculations are said and done, the Success Shortcuts Path

4 range of imprisonment that you were facing under all of

5 these pleas was 70 to 87 months; is that right?

6 A Yes, sir.

7 Q And take a look at page 5, paragraph 4.

8 You see as part of your agreement, right, this

9 cooperation agreement that you signed in September that

10 the government recommended already that Counts 1 and 2

11 served concurrently already with each other. You

12 understand what that means?

13 A Yes.

14 Q That means the sentences merge. When you got two

15 sentences they combine and merge. You wind up doing the Success Shortcuts Path

16 longest sentence, right?

17 A I understand.

18 Q And Counts 3 and 4 are to be served concurrently with

19 each other, and Counts 5 and 6 are to be served with

20 concurrently with each other, correct?

21 A Yes, sir.

22 Q That was as early as September of 1992, the Success Shortcuts Path

23 government was already recommending in your agreement that
24 whatever sentences you get under these counts be merged
25 and you serve one sentence, right?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4532
Watstein-cross/Jenks


1 A Yes, sir.

2 Q Now, as part of this agreement it says you'll have to

3 provide truthful, complete and accurate information,

4 right?

5 A That is correct.

6 Q And you understand that when it says truthful,

7 complete and accurate information, it's the government,

8 the United States Attorney's Office that determines what

9 is truthful, complete and accurate information; am I

10 right?

11 A Yes, I believe they would determine that.

12 Q It's their definition of what is truthful, complete

13 and accurate that fulfills this agreement, not your

14 definition, right?

15 A I'm not aware whether it be a unilateral definition

16 or not but I'm sure it is accurate to say that.

17 Q They decide what they think is truthful, complete and

18 accurate, right?

19 A I can't answer that question with a yes or no, sir.

20 Q Now, referring to paragraph 6 -- before we get to

21 that, let's talk about what you have to do to get your

22 cooperation agreement, all right.

23 It says you have to be -- agree to be fully
24 debriefed and attend all meetings, right?
25 You've done that?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4533
Watstein-cross/Jenks


1 A Yes, sir.

2 Q It says you have to furnish to the office all

3 documents and other material relevant to the investigation

4 that are in your possession or control?

5 A Yes, sir.

6 Q And to participate in undercover activities pursuant

7 to special instructions of law enforcement agents; is that

8 correct?

9 A Yes, sir.

10 Q You can't reveal your cooperation, right?

11 A Correct.

12 Q As a condition of your cooperation, you further have

13 to agree to testify at any proceeding in this district or

14 elsewhere?

15 A That's correct.

16 Q You saw that, right?

17 A Yes, sir.

18 Q And you have to consent to adjournments of your

19 sentences at times?

20 A Would have had to, yes, sir.

21 Q Which had happened in your case, right?

22 A Yes, sir.

23 Q And then you had agreed to cooperate fully with the Success Shortcuts Path
24 Internal Revenue Service to compute your taxes?
25 A Yes, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4534
Watstein-cross/Jenks


1 Q And it represents in paragraph 6 that no further

2 criminal charges will be brought against you for your

3 participation in criminal activity involving wire fraud,

4 mail fraud, credit card fraud, tax fraud, bank fraud, the Success Shortcuts Path

5 making of false statements to the United States Postal

6 Service and the Internal Revenue Service, obstruction of

7 justice and the defrauding of or stealing of money from

8 the United States, all from the period September 24, 1984

9 through July 30, 1991.

10 Do you see that?

11 A Yes, sir. What paragraph are you on?

12 Q I'm on paragraph 6.

13 A (Perusing.) Yes.

14 Q You see that; am I correct?

15 A Yes, sir.

16 Q Nobody charged you with credit card fraud, did they?

17 A No, sir.

18 Q Nobody ever charged you with bank fraud, did they?

19 A No, sir.

20 Q Those were charges you were facing though; am I

21 correct?

22 A Not to the best of my knowledge, no.

23 Q They are in this agreement that you wouldn't be
24 charged with those things?
25 A If I were guilty of them, yes, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4535
Watstein-cross/Jenks


1 Q And it says that you have to provide -- paragraph 7

2 -- substantial assistance to law enforcement

3 authorities.

4 Do you see that?

5 A Yes, sir.

6 Q Now, substantial assistance is something that the Success Shortcuts Path

7 government determines as to whether or not you gave it to

8 them; is that correct?

9 A Yes, sir.

10 Q You don't determine whether you've substantially

11 assisted the government, do you?

12 A No, sir.

13 Q Mr. White and Inspector Biegelman decide based on

14 what you've done for them whether or not you've provided

15 substantial assistance, right?

16 A No, sir, that is not accurate.

17 Q You are telling me that is not accurate.

18 A No, sir. Mr. White had nothing to do with this.

19 Q Seth Marvin at the time?

20 A Yes.

21 Q Let's use Seth Marvin instead of Mr. White.

22 Seth Marvin and Inspector Biegelman were the ones

23 who would determine whether or not you provided
24 substantial assistance, right?
25 A And I think also Officer Jordan as well.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4536
Watstein-cross/Jenks


1 Q Well, he's one of the agents also, correct?

2 A Yes.

3 Q He's from the IRS side of the case?

4 A That's correct.

5 Q And the defense lawyers in any given case, they don't

6 determine whether or not you've substantially assisted the Success Shortcuts Path

7 government; is that correct?

8 A That's correct.

9 Q The only ones that can give you the 5K letter that

10 you need are the U.S. Attorneys, right?

11 A That's correct.

12 Q So you have to earn the 5K letter, right?

13 A By hard work, yes, sir.

14 Q See, you understood, do you not, as you sit here

15 today, that unless you cooperated with the government, I

16 would be talking to you now in an orange jumpsuit?

17 A Probably correct, sir.

18 Q You would be doing 70 to 87 months in jail?

19 A I don't know what the number is, but it would be more

20 than I liked.

21 Q That was your estimate?

22 A Yes, sir.

23 Q In your cooperation agreement?
24 A That was the government's estimate, yes, sir.
25 Q 70 to 87 months?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4537
Watstein-cross/Jenks


1 A Yes, sir.

2 Q And if you had not cooperated with the government and

3 testified and called people up identifying yourself as

4 someone you weren't, you wouldn't be walking around doing

5 consulting work for Core States Bank, would you?

6 A I can't respond to that question the way you phrased

7 it, sir.

8 Q Let's put it this way.

9 If you didn't get this 5K letter, you would be in

10 jail?

11 A Probably.

12 Q You would have gone to jail.

13 A Yes, sir.

14 Q Are you surprised you didn't go to jail?

15 A I can't say I am, no.

16 Q You think you should have gone to jail?

17 A I can't comment on whether I should or shouldn't.

18 You asked whether I was surprised or not.

19 Q Well, for everything you've done, right, everything

20 you did criminally, you think you should have spent any

21 time in jail?

22 A I can't answer that question with a yes or no.

23 Q Do you think these people should spend any time in
24 jail?
25 A It wouldn't be my place to make that decision.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4538
Watstein-cross/Jenks


1 MR. WHITE: Objection --

2 THE COURT: When counsel gets up, he got up to a

3 half crouch at that time.

4 MR. WHITE: He's much faster than I am.

5 THE COURT: Well, he's not giving you much chance

6 to get up, but when you make an objection make it faster.

7 When you see him rise, that means he's about to make an

8 objection.

9 THE WITNESS: Yes, sir.

10 THE COURT: I was going to say he was going to

11 stroll around the courthouse but it doesn't matter.

12 MR. JENKS: May I continue, Your Honor?

13 THE COURT: Yes. I'm glad I slowed you down for

14 a while, Mr. Jenks.

15 BY MR. JENKS:

16 Q The government in fact did file a 5K letter for you;

17 am I right?

18 A Yes, sir.

19 Q And they filed your 5K letter to Judge Mishler; is

20 that correct?

21 A That's correct.

22 Q And they told Judge Mishler all the cooperation that

23 you had gone out of your way to do for them, right?
24 A That's correct, sir.
25 Q And then Judge Mishler sentenced you to six months

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4539
Watstein-cross/Jenks


1 house arrest, right?

2 A Amongst other things, yes.

3 Q Let's talk about the house arrest first.

4 A Okay.

5 Q When you got sentenced to the house arrest, house

6 arrest doesn't mean you are not allowed to do work?

7 A That's correct.

8 Q You used to go out every day. You weren't locked in

9 your room 24 hours a day seven days a week?

10 A I was allowed to work, yes, sir.

11 Q And you were working, right?

12 A Yes, sir.

13 Q You saw the 5K letter that the government had filed

14 to Judge Mishler?

15 A Yes, sir.

16 Q And now, as part of your cooperation, this isn't the Success Shortcuts Path

17 only company you recorded conversations in, right?

18 A That's correct.

19 Q You recorded conversations with former employees of

20 Oxford's Who's Who?

21 A That's correct.

22 Q Another corporation on Long Island?

23 A That's correct.
24 Q And as a result of the information you gave, a search
25 warrant was issued there and an individual by the name of

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4540
Watstein-cross/Jenks


1 William Blackwell was arrested, right?

2 A That's correct.

3 Q And you are also responsible, are you not, for the Success Shortcuts Path

4 guilty plea of Fred Shikinder (ph)?

5 A Yes. Shikinder.

6 Q Is that person related to the other Shikinder that

7 was one of your employees?

8 A Yes.

9 Q What is the relationship?

10 A I believe he's her father.

11 Q And he pled guilty based on what cooperation you've

12 provided, right?

13 A That's correct.

14 Q Then you made 60 calls to this company?

15 A 61.

16 Q 61?

17 A 61.

18 Q 61?

19 A Yes, sir.

20 Q And that resulted in 29 people being arrested in this

21 company, right?

22 A I'm not aware of the exact number, sir.

23 Q Well, it did result in numerous arrests, right? You
24 know that?
25 A I'm aware of numerous, yes, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4541
Watstein-cross/Jenks


1 Q In fact, you instigated the prosecution of this

2 company?

3 A Yes, sir.

4 Q You instigated to help you get this 5K letter?

5 A No, sir.

6 Q Are you not the person who went to Inspector

7 Biegelman in 1994 and told him about the Reed Elsevier

8 litigation with the Who's Who World Wide?

9 A Yes, sir.

10 Q Are you not the one that was monitoring closely what

11 had happened in the Reed Elsevier litigation against Who's

12 Who World Wide?

13 A No, sir, I was not.

14 Q You informed the postal inspector that Reed had

15 obtained a judgment against Who's Who World Wide for

16 1.7 million dollars, right?

17 A Yes, that was brought to my attention by my

18 attorney. I brought it to Inspector Biegelman's

19 attention.

20 Q And you went right to Biegelman?

21 A Yes.

22 Q And you suggested to Biegelman let's go after them

23 criminally, correct?
24 A Not in the slightest bit correct.
25 Q Why would you bring it to Biegelman's attention

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4542
Watstein-cross/Jenks


1 unless you wanted to get some more points to work off your

2 jail sentence?

3 A Not at all, sir. May I ask you a question? You

4 asked me a question why, I would like to explain the Success Shortcuts Path

5 question.

6 Q Let me withdraw the question and reframe it.

7 You knew that Reed Elsevier obtained a judgment

8 against Gordon's companies, correct?

9 A Yes, my attorney brought it to my attention.

10 Q And you went to Biegelman?

11 A Yes.

12 Q And then it was from August of '94 through March of

13 '95 that you began making these 61 calls?

14 A At Mr. Biegelman's request.

15 Q By the way, you were making these calls from all over

16 the country?

17 A That's correct.

18 Q Where were you making the calls from?

19 A Some of the calls were made from my home in Fort

20 Lauderdale.

21 Q Yes.

22 A Some were made from the Ramada Inn in New Jersey.

23 Some were made from the postal office inspection station
24 in Hicksville. Some were made from various hotels in
25 California.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4543
Watstein-cross/Jenks


1 Q Who was paying to fly you around the country while

2 you were out on bail in your case before sentence?

3 A Well, I was doing other business. I wasn't making

4 those trips because of the post office. I happened to be

5 there and that was where I made the phone calls from.

6 Q Was the government helping pay your expenses?

7 A No, sir.

8 Q But they were aware that while you were on bail and

9 while you were cooperating, you were flying all over the Success Shortcuts Path

10 country to take care of other business, right?

11 A With the full permission of probation, yes, sir.

12 Q And with the permission of the U.S. government?

13 A Yes.

14 Q You needed their permission?

15 A No, sir, just the probation department.

16 Q Well, the U.S. government had authorized the Success Shortcuts Path

17 probation department to allow you to go around the Success Shortcuts Path

18 country?

19 A The probation department makes their own decisions.

20 Q With the input of the U.S. government, sir?

21 A I'm not aware of that, sir.

22 Q Well, who thought or who cooked up the idea to make

23 the 61 calls to Who's Who World Wide, you or Biegelman?
24 A Inspector Biegelman.
25 Q And he told you, he said let's do what you do best,

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4544
Watstein-cross/Jenks


1 right, let's pretend we are someone we're not?

2 A That wasn't his phraseology, sir.

3 Q No.

4 A No, sir.

5 Q You know, I've listened -- you've listened to these

6 tapes, right?

7 A Yes, sir.

8 Q You know I've listened?

9 A Yes.

10 Q You know you are really smooth on the tapes, right?

11 MR. WHITE: Objection.

12 THE COURT: Sustained.

13 BY MR. JENKS:

14 Q This comes natural to you, doesn't it?

15 A Sir, I don't know what your question means. If I'm

16 capable of speaking English, yes.

17 Q I know you are capable of speaking English, whether

18 you were capable of lying. You went to the university of

19 Pennsylvania --

20 THE COURT: Let's not go into that again. We've

21 giem enough publicity.

22 BY MR. JENKS:

23 Q You've listened to them?
24 A Numerous times.
25 Q And you hear yourself lying up a storm, right? You

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4545
Watstein-cross/Jenks


1 are the one, hey, my name didn't come from some mailing

2 list, did it not? That's you talking?

3 A Absolutely.

4 Q Biegelman didn't put those words in your mouth?

5 A No, sir.

6 Q You thought them up?

7 A Yes.

8 Q Let me think these questions up to try to entrap some

9 people into getting in trouble so I could get my 5K letter

10 and walk out the door?

11 A Absolutely incorrect, sir.

12 Q Listen, it is correct because you were making those

13 calls to help yourself get a lighter sentence in 1995?

14 A Not to entrap the people, sir.

15 Q Sir, you were calling up to directly benefit yourself

16 by making those calls to these people otherwise you

17 wouldn't have been calling from Atlanta and from the Success Shortcuts Path

18 Ramada in New Jersey.

19 A I was calling to benefit myself but in no way to

20 entrap the people, sir.

21 Q Sir, you heard yourself speak on those tapes, right?

22 A Yes, sir.

23 Q You heard yourself say, yeah, I'm in this paper
24 company and I just got promoted to regional manager. It's
25 a bunch of nonsense, right?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4546
Watstein-cross/Jenks


1 A No, sir.

2 Q You were lying without even stuttering.

3 A I wasn't lying. I was doing what I was asked to do

4 making a call using a mock name to see what the nature of

5 the presentation would be.

6 Q You were lying who you were when you called in?

7 A I don't regard it to be a lie, sir. I was acting on

8 behalf of the U.S. government.

9 Q You remember calling up someone and identifying

10 someone who you were not as a lie?

11 A Not on the representation of the U.S. government.

12 Q Maybe to you that is not a lie, to me it is a lie.

13 MR. WHITE: Objection.

14 THE COURT: Sustained.

15 You have to give Mr. White a chance -- this time

16 he got up very quickly but you didn't give him a chance.

17 THE WITNESS: He was being blocked by Mr. Jenks.

18 THE COURT: Either he'll have to move or grow,

19 one or the other. I don't think he will get taller, so he

20 will have to move.

21 BY MR. JENKS:

22 Q Now, Mr. West, Inspector Biegelman didn't tell you

23 what to say in these calls, did he?
24 A Not initially.
25 Q This is something you cooked up on your own, right?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4547
Watstein-cross/Jenks


1 A You have to define "cooked up on your own" to me,

2 sir.

3 Q When you called in to make these tapes, you weren't

4 making these tapes because you had nothing better to do;

5 am I right?

6 A Inspector Biegelman asked me to make the calls, sir.

7 Yes, I made the calls.

8 Q And you wanted to make the calls, correct?

9 A I certainly did.

10 Q The design of those calls, when you made those calls

11 with a statement in mind that I want to get these people

12 in trouble, correct?

13 A No, sir.

14 Q Listen, you didn't make those calls because you were

15 in a charitable mood and you wanted to see what was going

16 on?

17 A That's not correct, sir.

18 Q You were making these calls to try to have these

19 people admit -- withdrawn.

20 You were making these calls to try to have these

21 people say something that would be criminal in nature so

22 they could get arrested and you could get a benefit from

23 it, right?
24 A No, that's not correct, sir.
25 THE COURT: Is this a good time to take a recess,

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4548
Watstein-cross/Jenks


1 Mr. Jenks.

2 MR. JENKS: It is, Your Honor.

3 THE COURT: Members of the jury, we'll take a

4 ten-minute recess.

5 Please don't discuss the case. Please keep an

6 open mind.

7 You notice I took a later recess because we

8 started later.

9 (Recess taken.)

10 (Jury enters.)

11 THE COURT: Tomorrow morning we'll start at

12 10 a.m. So if anybody wanted to come at 9 or at 8 or at

13 7, I would say no, I don't want you to do that. Come at

14 10 tomorrow.

15 BY MR. JENKS:

16 Q I want to talk to you more about these 61 calls that

17 you made.

18 A Yes, sir.

19 Q You made these 61 calls to try to get these people to

20 say something that would get them in criminal trouble,

21 correct?

22 A No, sir.

23 Q You did not, that's your testimony?
24 A That's correct.
25 Q You've listened to all 61 of these calls; is that

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4549
Watstein-cross/Jenks


1 correct?

2 A Yes, sir.

3 Q When you made these calls in virtually all of the Success Shortcuts Path

4 calls you used certain buzz words; am I right?

5 A If you mean certain phrases or sentences, the answer

6 is yes.

7 Q Certain phrases and sentences.

8 Let me give you certain sentences that you used.

9 A Yes.

10 Q Nominations?

11 A Yes, sir.

12 Q Mailing lists?

13 A Yes.

14 Q Statistics, what percentage of members are included,

15 right?

16 A Umm-hmm, yes.

17 Q And are there any conferences?

18 A Yes.

19 Q The plaque is not real marble. You recall those

20 phrases?

21 A Yes, sir.

22 Q About any foreign members?

23 A I may have used that a few times.
24 Q Famous members?
25 A Yes.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4550
Watstein-cross/Jenks


1 Q Who nominated me?

2 A Yes.

3 Q That's the theme of all of these calls you made?

4 A No, not entirely, sir.

5 Q But generally speaking, that's the theme of these

6 calls, those questions, right?

7 A No, sir.

8 Q You asked those questions designed to elicit a

9 specific answer, correct?

10 A I can't answer that question with a yes or no.

11 Q Well, you knew what the postal inspectors were

12 looking for in terms of answers to those questions, right?

13 A No, sir.

14 Q So you asked the key questions, correct?

15 A No, sir.

16 Q Sir, you made those 61 calls and you went out of your

17 way to tape record all of those calls?

18 A You mean out of my way I was instructed to tape all

19 of those calls.

20 Q You tape-recorded the calls.

21 A Yes, sir.

22 Q You never told the other person at the other end of

23 the calls that you were tape-recording those phone calls?

24 A No, sir.
25 Q In every single one of those calls you made, you

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4551
Watstein-cross/Jenks


1 lied, right?

2 A Not as I define lying, sir.

3 Q Maybe your definition of lying is different than my

4 definition of lying.

5 But when you tell somebody that you're somebody

6 you're not, you're lying, right?

7 A Not when I'm acting on behalf of the U.S. government,

8 no.

9 Q So when the government tells you to lie then you lie?

10 A Not in general, in a specific part of the Success Shortcuts Path

11 investigation, I thought it was okay.

12 Q You got the protection, the bulletproof protection of

13 a cooperation agreement, it's okay to lie to other people

14 to get them into criminal trouble, right?

15 A No, sir.

16 Q Do you feel as you sit here today that there's

17 anything wrong with telling a person you're somebody that

18 you're not?

19 A Not in an investigation, not at all, sir.

20 Q Would you agree with me it would be morally bankrupt

21 to represent yourself as somebody you are not?

22 A Not at all in an investigation. I don't agree with

23 you at all, sir.
24 Q As long as it is in the contention of an
25 investigation, it's okay what you want?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4552
Watstein-cross/Jenks


1 A Whatever you want. We're posing as a different

2 party, not doing whatever you want.

3 Q Posing as a different party to get people in criminal

4 trouble to save yourself from having to go to jail. You

5 find nothing wrong with that, right?

6 A No, sir. The way you phrase your question I can't

7 respond to your question.

8 Q Okay.

9 When you made these calls, right, you told the Success Shortcuts Path

10 people that in many of the calls "I already called, I

11 spoke to you a few weeks ago." Right, that's how old they

12 all start off?

13 A Not all start off.

14 Q With your nice smooth voice?

15 A Not all of them, no, sir.

16 Q Most of them said "I already called and I am looking

17 to become a member in your organization"?

18 A Not all, the majority of them start that way.

19 Q "I've already spoken to you." Do you recall that

20 line of nonsense?

21 A Partly, a minority of the calls start that way.

22 Q "I already spoke to you"?

23 A Four or five, maybe ten out of the 61.
24 Q "I just got promoted"?
25 A Four or five.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4553
Watstein-cross/Jenks


1 Q "My company got a few bucks, I want to go around for

2 some PR work"?

3 A Yes.

4 Q And "I sent in a card and never heard from a few

5 people so I'm calling you"?

6 A Yes, sir.

7 Q "I want to know what's involved being a part of this

8 organization," right?

9 A That's not my phrase -- that's not quite my

10 phraseology, sir, but we may say something such as that.

11 Q All of those statements are straight up, outright

12 misrepresentations, correct?

13 A Not in my context, sir, no, they are not.

14 Q Because you are doing an investigation for the Success Shortcuts Path

15 government.

16 You know, don't you find it interesting that

17 people are on trial here because the government says that

18 they lied yet it's okay for you to lie when you work for

19 the government calling up other people?

20 MR. WHITE: Objection.

21 THE COURT: Sustained. Please don't argue with

22 the witness.

23 BY MR. JENKS:
24 Q I just want to make sure I understand this, okay.
25 You feel that it's okay for you to lie as long as

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4554
Watstein-cross/Jenks


1 you are working in an investigation for the government?

2 A No, sir, that's not accurate. If you let me answer

3 your question. May I answer the question?

4 Q I'll withdraw the question.

5 A Thank you.

6 Q Let's take a look at this Government's Exhibit

7 13-30-A which is a tape you had with Steve

8 Waldon.

9 Stand up, Mr. Rubin.

10 Did you see Mr. Rubin before?

11 A No, sir.

12 Q You made a tape with him?

13 A Yes.

14 Q Where it is two to 300 degrees below zero but it's

15 okay in my mind.

16 A With Boris Yeltsin.

17 Q You know the tape?

18 A Yes.

19 Q You know what you had to do when you made that call

20 on the tape?

21 THE COURT: What exhibit is this?

22 MR. JENKS: 13-30-A, Your Honor.

23 THE COURT: 13-30-A for Able.
24 BY MR. JENKS:
25 Q You knew what you had to do when you called up?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4555
Watstein-cross/Jenks


1 A Yes, I knew what I had to do, sir.

2 Q I just selected this one out, okay. I can't go

3 through all 61 of them with you, but I thought this was a

4 good one for us to take a look at.

5 A Good.

6 Q You call in, you say you are Larry Weltman.

7 A What page is that?

8 Q Page 1 of 13-30-A.

9 Do you have the transcripts in front of you?

10 A Yes, sir.

11 Q I just picked this one. Let's take a look at some of

12 the things you say here in this transcript.

13 Page 1. You identify yourself as Larry Weltman;

14 is that correct?

15 A That's correct.

16 Q You are not Larry Weltman; is that correct?

17 A That's correct.

18 Q It says "I'm a printing salesperson and I just got a

19 promotion with national key accounts sales as a

20 salesperson"?

21 A I never work for them.

22 Q Never worked for them?

23 A That's correct.
24 Q Biegelman never told you that?
25 A I can't answer that.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4556
Watstein-cross/Jenks


1 Q This is something that you made up?

2 A That's not true, sir.

3 Q You make this up like you are talking about every day

4 affairs?

5 A If you let me answer your question about Inspector

6 Biegelman.

7 Q Say it your way.

8 A Inspector Biegelman suggested I choose various

9 occupations and names and make these calls to determine

10 the nature of the presentation. That was the nature of

11 his instructions. Acting upon his instructions I made

12 these calls.

13 Q And manipulate the nature of the presentation with

14 these people. Manipulated, getting them to say something

15 on the tapes?

16 A No such thing about anyone.

17 Q Let's look at page 2. Top of the page.

18 "We spoke about two months ago. Do you recall

19 the conversation?" And then Mr. Walden says "definitely,

20 yes." Do you see that?

21 A Yes.

22 Q You didn't speak to him two months ago; is that

23 correct?
24 A That's correct.
25 Q You did not speak to him?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4557
Watstein-cross/Jenks


1 A That's correct, I did not speak to him.

2 Q More lies and more nonsense calling in, correct?

3 A No, sir, that is not correct.

4 Q It's at least a lie?

5 A No, sir.

6 Q This is not a lie telling somebody on the telephone

7 that you don't even know that you spoke to them two months

8 ago?

9 A If I'm acting under Inspector Biegelman's

10 instructions to use a certain format in an investigation,

11 I don't regard that to be a lie.

12 Q The government grants you absolution, as they say,

13 you can say anything you want on the phone?

14 A Limited to the narrow niche of saying an occupation,

15 not saying whatever I wanted to, sir.

16 Q "You told me that I was nominated by one of the Success Shortcuts Path

17 members or some such thing and you gave me a brief

18 explanation and honestly, you used the word honestly in

19 there, and honestly I lost, I realized it wasn't

20 economically appropriate. Now, it's not a big deal to

21 spend $500 to get some PR for myself, so would, would,

22 would you just assume I'm ignorant here and just start

23 from the beginning if you would."
24 That's you talking, isn't it?
25 A Yes.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4558
Watstein-cross/Jenks


1 Q That's you talking to Mr. Walden, trying to get

2 Mr. Walden to say things to you so Mr. Walden could get

3 himself in criminal troubles?

4 A I'm getting him to say things. If he says things

5 that will get him in trouble, that's on his own.

6 Q So you are asking him on this transcript about famous

7 people, about who nominated you, about mailing lists; am I

8 correct?

9 A Those questions were correct, sir, yes, I asked those

10 questions. I didn't make the answers come out of

11 Mr. Walden though.

12 Q You asked the questions so he would make the answers

13 come out?

14 A He could answer honestly or dishonestly, his choice.

15 Q It was his choice but it is okay for you to say

16 whatever you want to say on the telephone?

17 A I didn't say whatever I wanted to say. It was a very

18 narrow issue what I wanted to say.

19 Q You weren't a national key account manager?

20 A No, sir.

21 Q You weren't calling from Atlanta, were you?

22 A No, sir.

23 Q Where were you calling from?
24 A I don't have a recollection at this point.
25 Q All right.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4559
Watstein-cross/Jenks


1 You told him you are a manufacturer, correct?

2 A That is correct.

3 Q You are not any kind of a manufacturer, right?

4 A No, I'm not, sir.

5 Q You tell him in here on page 9, in the middle of the Success Shortcuts Path

6 page "to be honest with you, honestly, I don't want to

7 mislead the people because I'm just getting the promotion

8 as of January 1st."

9 Do you see that in the transcript?

10 A Yes, sir.

11 Q You were misleading everybody, right, including

12 Mr. Walden?

13 A Sir, as I previously stated --

14 Q Right.

15 A I'm testifying here if I'm acting upon a postal

16 investigator's investigation, I'm not acting or misleading

17 the party.

18 Q You asked about nominations on page 10. A male

19 voice, in the middle of the page "someone had nominated

20 me. Which of my clients was it?"

21 Do you see that?

22 A I don't see that, sir.

23 Q Look at page 10 in the middle of the page under "male
24 voice."
25 You are the male voice, right?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4560
Watstein-cross/Jenks


1 A I see that, Counselor, yes.

2 Q You see that, right?

3 A Yes, sir.

4 Q You knew that nobody had nominated you, that you were

5 cooperating with the government?

6 A Yes, sir. Part of the investigation.

7 Q Let me show you this and I'll mark this as

8 Defendant's Exhibit AM.

9 THE COURT: Able M.

10 MR. JENKS: Able Mike, Your Honor.

11 BY MR. JENKS:

12 Q Now, let's take a look at Defendant's Exhibit AM.

13 THE COURT: Is that for Identification?

14 MR. JENKS: For Identification, Your Honor.

15 A Yes, sir.

16 Q Do you see that?

17 A Yes, sir.

18 Q That's a checklist you made up of questions to ask;

19 am I right?

20 A Actually, it is questions I asked after the fact.

21 Actually, it's an analysis of the tape or a conversation

22 as opposed to a checklist. It was Mr. Biegelman's or

23 Inspector Biegelman's evaluation of the tape.
24 Q This is in your handwriting, right?
25 A That's correct.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4561
Watstein-cross/Jenks


1 Q It's an analysis of check points. It says, "tape

2 number check points," right?

3 A That's correct.

4 Q And the check points that are on here is who is Kathy

5 Ross, right?

6 A That's correct.

7 Q How was I nominated? What about conferences? Where

8 are the seminars? Was my name on the list? Will my name

9 ever be rented? Is this a prestigious association? What

10 percentage of people get selected?

11 MR. WHITE: Excuse me. Will you tell me what you

12 are reading from or give me a copy of it?

13 MR. JENKS: I don't have a copy to give you but

14 I'll certainly let you look at it.

15 MR. NELSON: 3500-22-H for the tape number 35.

16 MR. SCHOER: Tape number 35.

17 BY MR. JENKS:

18 Q This is a checklist of tape number 35?

19 A After it was created, yes, sir.

20 Q And it's in your handwriting?

21 A Absolutely.

22 MR. JENKS: I will offer this as Defendant's

23 Exhibit AM in evidence, Your Honor.
24 THE COURT: Show it to counsel.
25 MR. WHITE: Your Honor, I have an objection

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4562
Watstein-cross/Jenks


1 because this is a two-page document that Mr. Jenks is

2 offering. He's offering only one page of it.

3 THE COURT: May I see the documents?

4 MR. WHITE: And it also relates to a different

5 conference he just asked Mr. West about.

6 MR. JENKS: (Handing to Court.)

7 THE COURT: You say that document marked tape

8 number 35 is part of the exhibit?

9 MR. WHITE: No, Your Honor. That's my point.

10 There's a cover page for tape 34. The offered exhibit is

11 page 2 of that document. That relates to a different

12 conversation.

13 THE COURT: Well, I don't have that in front of

14 me.

15 MR. JENKS: Your Honor, maybe we should have a

16 side bar on this.

17 THE COURT: Come up.

18 (Side bar.)

19 MR. WHITE: Let me check the original. Maybe I'm

20 confused. In any event, it is a two-page document.

21 THE COURT: Where are the two pages?

22 MR. NELSON: (Handing.)

23 THE COURT: Are these both in Mr. Watstein's
24 handwriting?
25 MR. JENKS: I believe so, Your Honor.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4563
Watstein-cross/Jenks


1 Mr. White, look at the bottom of the two

2 documents.

3 MR. WHITE: All right. May I see the offered

4 exhibit?

5 MR. JENKS: (Handing.)

6 MR. WHITE: Okay, I'm incorrect. This does

7 relate to number 35 but it is a two-page document.

8 MR. JENKS: Those two pages right here.

9 MR. WHITE: If you put them both in I will have

10 an objection.

11 MR. DUNN: I object, Judge, to the first page

12 going in, Judge. If you look at the very bottom of the Success Shortcuts Path

13 first page where it has comments.

14 THE COURT: This one?

15 MR. DUNN: Yes. Next to comments it has major

16 misrepresentations and I oppose that going into evidence.

17 That is a conclusion that this individual apparently

18 made. Biegelman made.

19 THE COURT: You oppose it if it is redacted,

20 those comments.

21 MR. DUNN: If that's redacted, fine, I would have

22 no objection.

23 THE COURT: I would redact it.
24 MR. JENKS: I have no problem with that.
25 MR. WHITE: That's fine.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4564
Watstein-cross/Jenks


1 THE COURT: As redacted, the two-page document

2 will go in.

3 (End side bar.)

4 THE COURT: All right. Defendant's Exhibit AM,

5 Able Mike, two pages as redacted in evidence.

6 (Defendant's Exhibit AM received in evidence.)

7 BY MR. JENKS:

8 Q This is a checklist you made up in your handwriting,

9 correct, and that relates to tape number 35, right?

10 A After the creation of the tape.

11 Q Why don't we look along with it to see what

12 checkpoints you put down, okay, since you weren't trying

13 to get these people in criminal trouble.

14 Who was Kathy Ross, you put that in there; is

15 that correct?

16 A That is correct.

17 Q How was I nominated?

18 A Yes.

19 Q What about conferences? What are seminars?

20 A Yes.

21 Q Was name on the list? Will my name ever be rented?

22 Is this a prestigious association? What percentage of

23 people get selected? How long have you been in business?
24 How long have you been there? Do you have a good Better
25 Business Bureau report?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4565
Watstein-cross/Jenks


1 A Yes.

2 Q These are all checkpoints to check yourself to make

3 sure you asked all the right questions while you were on

4 the phone?

5 A No, sir. These were checkpoints for Inspector

6 Biegelman and his evaluation of the tape after they were

7 already created.

8 Q Right.

9 You wanted to make sure that Inspector Biegelman

10 knew you were asking all the right questions, correct?

11 A No, sir.

12 Q All right.

13 Let's talk a little bit more about your 5K

14 letter. We already established that you recorded

15 conversations with Oxford Who's Who and with Who's Who

16 World Wide and that you made some 61 calls.

17 You also were involved, were you not, in the case

18 of United States versus Robert Rosenfeld?

19 A Yes, I'll need a copy of the 5K letter if you are

20 reading from that, sir.

21 MR. JENKS: That's 3500-22-I.

22 BY MR. JENKS:

23 Q I'll show you 3500-22-I for Identification with the Success Shortcuts Path
24 attachments.
25 That's your 5K letter from the government,

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4566
Watstein-cross/Jenks


1 correct?

2 A Thank you. I'll look at it. Thank you.

3 Yes, sir.

4 Q And the 5K letter itself is four typewritten single

5 spaced pages, right?

6 A Yes, sir.

7 Q And you are familiar with the case United States

8 versus Robert Rosenfeld?

9 A Yes, sir.

10 Where are you reading from?

11 Q Paragraph 3.

12 A On which page, sir?

13 Q Page 2. It's actually number 3.

14 Do you see number 3?

15 A Yes, sir.

16 Q Are you familiar with that case?

17 A Yes, sir.

18 Q That was a case in front of Judge Spatt, correct?

19 A I don't know who it was in front of, sir, but I'm

20 familiar with the case.

21 Q You worked in an undercover capacity and as a result

22 of your cooperation Mr. Robert Rosenfeld was arrested and

23 did a 21 month term in jail; is that correct?
24 A That's correct.
25 Q Robert Rosenfeld had nothing to do with Who's Who

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4567
Watstein-cross/Jenks


1 World Wide?

2 A To the best of my knowledge, yes.

3 Q The answer is he did not?

4 A He did not, that's correct.

5 Q You also made recorded calls to the target of a

6 mail-order fraud investigation, right, and that as a

7 result resulted in the arrest of a John Yung in February

8 of 1995 on mail fraud charges, that's correct?

9 A Yes.

10 Q Did you testify in that case?

11 A No, sir.

12 Q Did you testify at Rosenfeld's?

13 A No.

14 Q Did you testify in any proceeding in front of Judge

15 Spatt or in front of Judge Mishler?

16 A No, sir. I testified in front of Judge Mishler in my

17 own proceeding.

18 Q In your own sentence?

19 A Yes.

20 Q When you told him how sorry you were for everything;

21 is that correct?

22 A That's correct, sir.

23 Q Number 5, you got letters from people in the Success Shortcuts Path
24 Department of Labor in Florida, right, for work you had
25 done there; is that correct?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4568
Watstein-cross/Jenks


1 A That's correct.

2 Q You also got yourself involved in an advertising

3 fraud investigation, number 6?

4 A That's correct.

5 Q And you also met with the principal of an airline

6 ticketing company on an undercover basis and obtained

7 detailed information relating to the operation of his

8 company. You did that, right?

9 A Yes.

10 Q You got him in trouble?

11 A No, sir. He was exonerated.

12 Q He went to trial in the New York State court?

13 A I believe that was a civil trial.

14 Q You testified in that trial?

15 A No, sir.

16 Q You called an international Who's Who company in the Success Shortcuts Path

17 south as well; is that correct?

18 A Yes.

19 Q You provided information for two targets of tax fraud

20 in Miami, Florida also, correct?

21 A That's correct.

22 Q You went to a party up in New Jersey; is that

23 correct?
24 A A number of parties. If you are referring to the one
25 in this document, the answer is yes.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4569
Watstein-cross/Jenks


1 Q In number 12.

2 A Yes, sir.

3 Q You were trying to target a money laundering

4 operation, right?

5 A That was the request of the FBI, yes, sir.

6 Q Did you make recorded calls there while you were

7 there or secret tapes?

8 A Not at the party, no.

9 Q Later on you did?

10 A Previous to that.

11 Q Okay.

12 Then of course you testified in the grand jury in

13 United States versus Gregory Phillips, Linda Zeitzer, and

14 Kathy Shikinder which is a Judge Mishler case?

15 A That's correct.

16 Q Those are your three employees?

17 A As I previously testified.

18 Q That was your case?

19 A Yes, sir.

20 Q And you went in the grand jury and you provided

21 detailed and invaluable information about the involvement

22 of these employees? You did that, right?

23 A That's correct.
24 Q You gave history and background about these people?
25 A That's correct.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4570
Watstein-cross/Jenks


1 Q And did you ever enter into a second cooperation

2 agreement with the government and after in fact you were

3 sentenced?

4 A No, I believe Judge Mishler instructed me to

5 cooperate and there was no need for a formal cooperation

6 agreement.

7 Q You were instructed to cooperate by the Judge --

8 Judge Mishler, by the way, sits upstairs in this building?

9 A That's correct.

10 Q And he was your judge from the beginning to the end

11 of this case?

12 A That's correct, sir.

13 Q As a condition of your probation he instructed you to

14 cooperate?

15 A That's correct.

16 Q In other words, under normal circumstances once you

17 are sentenced your cooperation ends, correct?

18 A I'm not aware of that, sir.

19 Q Well, you knew that when you were in front of Judge

20 Mishler?

21 A No.

22 Q Because the Judge himself had instructed that you

23 continue to cooperate with the government during the Success Shortcuts Path
24 course of your probation?
25 A But I wasn't aware of what was normal and what

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4571
Watstein-cross/Jenks


1 wasn't.

2 Q All right.

3 Do you see in the letter that the government

4 wrote to Judge Mishler on the last page of that letter

5 "while we are guardedly optimistic that Watstein will

6 change his pattern of conduct in the future, it is

7 difficult to ignore his long-term criminal and fraudulent

8 conduct."

9 Do you see that?

10 A Yes, sir.

11 Q "Without attempting to trivialize Watstein's history

12 or the tens of thousands of people he has victimized, we

13 conclude that Watstein has provided substantial assistance

14 in the investigation and prosecution of others."

15 A You skipped a line there, sir.

16 Q "We conclude based upon the hundreds of hours of time

17 he has invested cooperating with the government, that's in

18 parenthesis, that Watstein has provided substantial

19 assistance in the investigation and prosecution of

20 others. We therefore submit this letter pursuant to

21 Section 5K1.1 of the sentencing guidelines so that the Success Shortcuts Path

22 Court may in its discretion depart from the guideline

23 ranges of 57 to 71 months in imposing sentence."
24 Correct?
25 A That's correct, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4572
Watstein-cross/Jenks


1 Q So your ultimate range when you were being sentenced

2 was down to 57 to 71; is that correct?

3 A That's correct, without guidelines, without downward

4 adjustment.

5 Q So despite your long-term criminal conduct and

6 fraudulent conduct, you still managed to manipulate

7 yourself a sentence of nonjail, right?

8 A The word manipulation is not a word that I accept,

9 sir.

10 Q You don't like the word manipulation.

11 You still managed to get yourself a nonjail

12 sentence; is that correct?

13 A That's correct.

14 Q I want to show you one other exhibit here.

15 Just take a look at this for me. This is

16 3500-22-G for Identification.

17 Take a look at that.

18 A Yes, sir.

19 Q You sent that document, right?

20 A Yes, sir.

21 Q You typed that up and sent it off to Biegelman,

22 correct?

23 A No, sir.
24 Q You didn't. It says "to Marty Biegelman," not
25 Inspector Martin T. Biegelman, but "to Marty Biegelman,"

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4573
Watstein-cross/Jenks


1 right, "from Steve West"?

2 A That's correct.

3 Q Did you prepare this document?

4 A No, sir.

5 Q Someone else typed it for you?

6 A Yes.

7 Q You gave the information in this document?

8 A Absolutely.

9 Q Dated August 29, 1994?

10 A Yes, sir.

11 Q Did you inform Inspector Biegelman that you had

12 learned that Who's Who World Wide maintains an entire

13 floor at 760 Lexington Avenue, fourth floor, and the Success Shortcuts Path

14 person in charge of the office was Maggie Swendseid?

15 A Yes.

16 Q You told that -- you told Biegelman that supposedly

17 they have conference room facilities and are renting it

18 out to members?

19 A If that's what it says in the letter.

20 Q "I will continue the process out here," is that what

21 you told him?

22 A I was duty bound to report all the information to

23 Inspector Biegelman, that's what I did.
24 Q You were typing memos to Inspector Biegelman as to
25 what was going on in 1994?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4574
Watstein-cross/Jenks


1 A The singular memo.

2 Q This singular memo?

3 A Yes, sir.

4 Q You had this prepared and you mailed it off to him?

5 A I believe it was faxed to him.

6 Q To let him know "I will continue to process out

7 here."

8 When you sent this memo, where were you?

9 A My office in Pompano Beach, Florida at 1000 West

10 McNab Road.

11 Q And you wanted to let him know you will continue

12 doing what you are doing, right?

13 A Absolutely.

14 MR. JENKS: I'm going to offer this, Judge, as

15 Defendant's Exhibit AN in evidence.

16 THE COURT: Any objection?

17 MR. WHITE: No, Your Honor.

18 THE COURT: Defendant's Exhibit AN in evidence.

19 What is that, Mr. Jenks?

20 MR. JENKS: It's a memorandum, Your Honor.

21 THE COURT: What is the date of that?

22 MR. JENKS: August 29, 1994.

23 (Defendant's Exhibit AN received in evidence.)
24 BY MR. JENKS:
25 Q Now, I'm just going to talk to you about a few more

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4575
Watstein-cross/Jenks


1 things and one of them I want to talk to you about is some

2 other criminal activity that you've had because we want to

3 -- withdrawn.

4 When you had your company Who's Who U.S.

5 Executives, you represented to your employees that they

6 had health insurance, right?

7 A That is correct, sir.

8 Q And the healthcare insurance was nonexistent; is that

9 right?

10 A Totally incorrect, sir.

11 Q Well, you saw your sentence report that was prepared

12 in your criminal case, right?

13 A Yes, sir.

14 Q There's a section in there that says other criminal

15 conduct about you, right?

16 A It was not proven and it was inaccurate, sir.

17 Q It was inaccurate?

18 A That's correct.

19 Q Well, let's see, you tell me what is inaccurate here,

20 okay.

21 A Okay.

22 Q It says "the government engaged in a scheme to

23 defraud employees"?
24 A The government?
25 Q "The defendant engaged in a scheme to defraud

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4576
Watstein-cross/Jenks


1 employees of Who's Who by providing them with healthcare

2 insurance which was nonexistent. According to a former

3 employee West informed employees that they would be

4 provided healthcare insurance by Blue Cross/Blue Shield."

5 Did you tell employees that?

6 A Yes, sir and it was.

7 Q "Payment for health insurance was deducted directly

8 from the employees' salaries. However, according to the Success Shortcuts Path

9 former employee, he was hospitalized and discovered that

10 he had no health insurance."

11 Is that so? Do you recall that?

12 A Do I recall the employee stating that?

13 Q Yes.

14 A Yes, I recall the employee stating that.

15 Q Was that accurate?

16 A I don't know whether it was accurate or not, but

17 there was an employee.

18 Q Did you defraud the employee when he was supposed to

19 have hospital insurance and when he went to the hospital

20 he didn't?

21 A No, sir.

22 Q When the former employee said that he was not the Success Shortcuts Path

23 only employee defrauded by you in this manner, is that
24 also an inaccurate statement?
25 A Yes, sir, it is inaccurate.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4577
Watstein-cross/Jenks


1 MR. JENKS: Just a moment, Your Honor.

2 THE COURT: Yes.

3 MR. JENKS: Just a few more questions, Mr. West.

4 BY MR. JENKS:

5 Q You never worked for Who's Who World Wide, did you?

6 A No, sir.

7 Q For Sterling Who's Who?

8 A No, sir.

9 Q Had you ever been in the offices?

10 A I've been in the building in which the office was

11 located. I was not physically in their offices.

12 Q Which building, Lake Success?

13 A Yes, sir.

14 Q But you've never been inside?

15 A That's correct.

16 Q You are not then specifically familiar with the Success Shortcuts Path

17 business policies that Mr. Gordon had; is that correct?

18 A That's correct, I'm not familiar.

19 Q Now, in 1993, January, or early 1993, after you

20 signed your cooperation agreement, you took ads with the Success Shortcuts Path

21 postal service in Newsday and the New York Times to

22 interview people who worked in Who's Who?

23 A I did not take ads with the postal service.
24 Q The postal service took ads?
25 A No, sir.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4578
Watstein-cross/Jenks


1 Q Who took the ads?

2 A I took the ads.

3 Q In the paper?

4 A Yes.

5 Q That was to get people to come in to apply for the Success Shortcuts Path

6 jobs out of Who's Who, correct?

7 A From previous Who's Who and current Who's Whos, yes,

8 sir.

9 Q You sat down while you were cooperating with the Success Shortcuts Path

10 government and met with all sorts of individuals about

11 possible employment at your Who's Who, right?

12 A At a proposed Who's Who, yes, sir.

13 Q At a proposed.

14 Once again, you were misrepresenting yourself to

15 people, right?

16 A No, sir.

17 Q You actually had people come to do an interview with

18 you for a job that didn't exist?

19 A No, sir, this was a government investigation acting

20 in conjunction with the government in the posture we took.

21 Q So that was okay to make a people waste an hour of

22 their time interviewing with you for a job that didn't

23 exist?
24 A That was an interview in the investigation.
25 Q Was this Garden City?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4579
Watstein-cross/Jenks


1 A Two separate occasions.

2 Q Did the postal department provide you with scripts

3 you would use in talking with these people?

4 A No, sir.

5 Q You didn't need a script, you knew what to ask them?

6 A In general, I knew what to ask them, yes, sir.

7 MR. JENKS: Your Honor, I have no further

8 questions.

9 THE COURT: All right.

10 CROSS-EXAMINATION

11 MR. NELSON:

12 Q Mr. West, I would like to clarify or go over a couple

13 of things about the operation of your business Who's Who

14 in United States Executives, Inc.

15 I believe you told Mr. Jenks, and correct me if

16 I'm wrong, that your company sent solicitation letters to

17 potential customers. Is that correct?

18 A Yes, sir.

19 Q And you were the author of those letters, that is

20 right?

21 A In the majority, yes, sir.

22 Q And in the merits you authored, am I correct, you

23 stated to the prospective customers that they had been
24 reviewed by a selection committee?
25 A There were many letters. It's possible one or two of

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4580
Watstein-cross/Nelson


1 those letters it was stated that way, yes, sir.

2 Q And in those letters you specifically indicated, am I

3 correct, that there was specific people on the selection

4 committee such as Jim Moore, the vice-president of

5 Citibank and John Finnell, a former Assistant Attorney

6 General?

7 A Finnell, I previously testified to that.

8 THE COURT: How is that spelled?

9 MR. NELSON: F-I-N-N-E-L-L.

10 BY MR. NELSON:

11 Q Now, would I be correct in stating that you had met

12 those people during the course of your lifetime but

13 neither of those individuals were on any selection

14 committee for Who's Who of United States Executives; is

15 that right?

16 A No, sir, that is not correct.

17 Q Oh, they were on a selection committee?

18 A I can't answer that question with a yes or no.

19 Q Were they on the selection committee you wrote the Success Shortcuts Path

20 letters on about or not?

21 A I can't answer that question with a yes or no. One

22 was and one wasn't, if that is acceptable to you.

23 Q One was for one day or two days?
24 A For a substantial period of time as I previously
25 testified up until the investigation of the postal

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4581
Watstein-cross/Nelson


1 department.

2 Q And did he review people who were going to be members

3 of Who's Who in the United States Executives?

4 A No, sir, he performed no useful function in that

5 category.

6 Q Didn't exist?

7 A What didn't exist?

8 Q There was no real selection committee?

9 A As a functional basis, you are correct.

10 Q You also told people in these letters there was

11 somebody by the name of Thorton Rockefeller and another

12 person by the name of Harlan Carnegie?

13 A Yes, sir, I already answered that people.

14 Q Neither of these people?

15 A That's correct.

16 Q Am I correct once the letters came in they would be

17 given to the people in the sales department for purposes

18 of calling up potential customers?

19 A No, sir.

20 Q Well, did the people respond to those letters by some

21 kind of a ballot of some kind?

22 A They completed an application, sir.

23 Q Was that application sent back to the company?
24 A Yes, sir.
25 Q You would then give that application to the sales

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4582
Watstein-cross/Nelson


1 staff for purposes of calling prospective members; is that

2 right?

3 A That was not the next step, sir.

4 Q Well, they came back, didn't they?

5 A I'm sorry, sir?

6 Q The applications would come back; is that correct?

7 A That's correct.

8 Q Would they be given to the sales managers?

9 A That was not the next step, sir.

10 Q Would they be given to you?

11 A On some occasions.

12 Q Okay.

13 They eventually were given to the sales managers;

14 is that correct?

15 A Yes, sir. Eventually, yes, sir.

16 Q And the sales managers would then give them to the Success Shortcuts Path

17 sales staff; is that right?

18 A That's correct.

19 Q Now, am I correct that in your company there was a

20 script or a presentation that was utilized by the sales

21 staff when they spoke to the prospective customers who had

22 sent in the applications?

23 A Actually numerous scripts, sir.
24 Q And you were the author of those scripts; is that
25 right?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4583
Watstein-cross/Nelson


1 A In the majority. There were other authors but I take

2 full responsibility.

3 Q You made many misrepresentations in those sales

4 scripts; is that correct?

5 A That's correct.

6 Q The sales managers who were employed by you and would

7 I be correct in stating there were a number of different

8 sales managers employed by you and were paid compensation

9 by you; is that correct?

10 A By the company, that's correct, sir.

11 Q Am I correct, in addition to receiving a salary, the Success Shortcuts Path

12 sales managers also received an override commission on the Success Shortcuts Path

13 sales made by the members of the sales staff?

14 A In general, that is correct, sir.

15 Q So I would be correct in stating that you gave your

16 sales managers an incentive by way of this commission to

17 make sure that every or as many applicants, no matter what

18 their qualifications would be accepted; is that correct?

19 A I think that is a substantially accurate statement.

20 Q Thank you.

21 Would I be correct in stating, I believe you

22 previously testified, that the directory that you --

23 withdrawn.
24 Am I correct that one of the things that you were
25 selling to people were their inclusion in a directory



OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4584
Watstein-cross/Nelson


1 which they could purchase?

2 A That's partially correct, sir.

3 Q Am I correct that a large number of people to whom

4 you were selling a directory and their names were supposed

5 to be included in that directory, did not have their names

6 included in that directory?

7 A Yes, because of the computer failure. Yes, sir.

8 Q You sent out, based on publication at some point in

9 time, a directory that didn't include a large number of

10 people who applied?

11 Yes or no?

12 A You have to define "large number" for me, sir.

13 Q Well, were you aware of the fact that Inspector

14 Biegelman in a sworn complaint for which he arrested you

15 conducted a survey with American Express based upon your

16 customers in 1990 who purchased via American Express prior

17 to your being cancelled by American Express and discovered

18 based upon that survey of 91 people who used their

19 American Express card who purchased your registry to have

20 their name included in their registry, only one person

21 ever had their name in any of your registries? Were you

22 aware of that?

23 A No, sir.
24 Q Did you ever read the complaint that Inspector
25 Biegelman arrested you upon?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4585
Watstein-cross/Nelson


1 A I didn't recall seeing that in the complaint, sir.

2 Some of the complaint may have been redacted when I

3 received it.

4 MR. NELSON: May I have just one moment, Your

5 Honor?

6 THE COURT: Yes.

7 BY MR. NELSON:

8 Q I would like to show you page 31 of 30-519-Q. I

9 would ask you to look at the first page of the document.

10 Is this the complaint in the case you were

11 arrested on, United States versus Steven Samuel Watstein?

12 A I can't tell from all the papers. It appears to be

13 the complaint. It's the cover page of the complaint.

14 Q I would like you to look at page 31, paragraph F

15 entitled "the victims," turning to the second sentence.

16 Am I correct that it states in the sworn

17 complaint by Inspector Marty Biegelman that many customers

18 never received the directory they ordered and thousands of

19 customers have complained and demanded their money back

20 from the company. American Express has advised that

21 approximately 91 randomly selected complaints who made a

22 purchase from the company during the time that the second

23 edition of Who's Who in United States Executives was being
24 sold, only one was listed in this edition which was
25 published in March of 1990.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4586
Watstein-cross/Nelson


1 Does it state that in Inspector Biegelman's sworn

2 complaint?

3 Yes or no?

4 A Yes, sir.

5 Q And am I correct that when you were arrested you were

6 provided with a copy of that complaint?

7 A At the time of my arrest, I did not read that

8 paragraph, sir. This was the first time I was aware of

9 the American Express survey.

10 Q Did you review it with the three different lawyers

11 you said you had retained over the course of the two-year

12 investigation who you had paid hundreds of thousands of

13 dollars to represent you?

14 A I certainly missed that paragraph as I just testified

15 up until and including today.

16 Q Did any of those lawyers who were paid hundreds of

17 thousands of dollars to represent you to get you six

18 months detention, ever wind up explaining to you whatever

19 was in that complaint?

20 A In substance they did, sir. I missed that one

21 paragraph, sir.

22 Q Would I be correct in stating that that is a true

23 statement in the complaint that a large number of the Success Shortcuts Path
24 people who paid to be inside of your registry never even
25 had their names included?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4587
Watstein-cross/Nelson


1 A I previously asked you to define "large number." I

2 believe it was a substantial number, in my judgment.

3 Q Do you believe Inspector Biegelman was telling the Success Shortcuts Path

4 truth in that sworn complaint --

5 A Yes, sir.

6 Q -- That less than one point were actually included in

7 that registry in that review?

8 A In that sample size, yes, I'm sure they were telling

9 the truth.

10 Q And I believe you testified that with respect to the Success Shortcuts Path

11 registries themselves that eventually did get published, a

12 large number of those registries were never sent to the Success Shortcuts Path

13 people who purchased them; is that right?

14 A No, sir.

15 Q Were registries not sent to quite a number of people?

16 A Yes. Quite a number would be an accurate phrase, not

17 a large number.

18 Q When you pled guilty you acknowledged that a large

19 number were not sent to people who paid for them?

20 A The phraseology was large number or quite a number,

21 but the phraseology is substantially accurate.

22 Q Considering the fact that a lot of people didn't get

23 their names included and they didn't get their registries,
24 a lot of people complained and asked for refunds; isn't
25 that right?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4588
Watstein-cross/Nelson


1 A Yes, sir.

2 Q With respect to those refunds, I believe you

3 testified that you actually gave commissions to people in

4 your company to not give refunds to people, that was a

5 policy in your company?

6 A Sir, the policy was to attempt to motivate people to

7 continue their membership.

8 Q By lying to them about the fact that you're not going

9 to give refunds and to give commissions to your employees

10 to not give those refunds, was that part of your policy?

11 MR. WHITE: Objection.

12 THE COURT: Yes, sustained.

13 Please lower your voice.

14 MR. NELSON: Yes, Your Honor, I'm getting loud.

15 MR. WHITE: My objection is that he interrupted

16 the witness' answer.

17 MR. NELSON: I'll withdraw the question.

18 MR. WHITE: Can the witness answer the previous

19 question?

20 MR. NELSON: I'll withdraw it.

21 THE COURT: Not if it is withdrawn.

22 MR. WHITE: He's withdrawing it too.

23 MR. NELSON: I'll withdraw that too.
24 BY MR. NELSON:
25 Q Am I correct, Mr. West, that your prior testimony was

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4589
Watstein-cross/Nelson


1 that at some point in time you gave commissions to

2 employees of yours when they would not give refunds to

3 customers who were complaining and asking for refunds?

4 A That isn't accurately phrased, sir. That is not

5 accurately phrased.

6 Q Did you give commissions at any point in time to

7 employees of yours who were not providing refunds to

8 customers?

9 Yes or no?

10 A That's not accurate, the phrase. I can't give you an

11 answer to that the way you phrase your question.

12 THE COURT: Is this a good time to take a break?

13 MR. NELSON: Yes, Judge.

14 THE COURT: All right. Members of the jury,

15 we'll recess until 10 a.m. tomorrow morning.

16 Please do not discuss the case among yourselves

17 or anyone else. I'm sure the people at home have long ago

18 stopped asking you questions or they might be saying, when

19 are you going to get through with this case? Maybe that's

20 what they are asking you. In any event, please tell them

21 you're a trial juror in the United States District Court

22 and you're going to stick it out to the end.

23 Keep an open mind. Come to no conclusions. We
24 will recess until 10 a.m. tomorrow.
25 Have a nice evening.

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4590
Watstein-cross/Nelson


1 (Jury exits.)

2 THE COURT: You will have to be back prior to

3 10 a.m. tomorrow morning, Mr. Watstein.

4 THE WITNESS: Yes.

5 THE COURT: You may step out now.

6 (Witness excused.)

7 THE COURT: What is the government's schedule?

8 MR. WHITE: I'm assuming before I answer that --

9 THE COURT: How many other people will

10 cross-examine Mr. Watstein?

11 MR. TRABULUS: I will.

12 MR. NEVILLE: And I will.

13 MR. GEDULDIG: I think I'll have a relatively

14 short cross-examination, Your Honor.

15 THE COURT: Three more.

16 MR. WHITE: Three more plus Mr. Nelson who just

17 started.

18 THE COURT: Yes.

19 MR. WHITE: I think after Mr. Watstein we'll have

20 Marilyn Price.

21 THE COURT: How do you spell that?

22 MR. WHITE: P-R-I-C-E, and Philip Westcott,

23 W-E-S-T-C-O-T-T. It sounds like we'll consume the day.
24 MR. LEE: May I ask if there is another name for
25 Mr. Price that may have been used?

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4591

1 I just wanted to make sure.

2 MR. WHITE: Your Honor, may I put two other

3 things on the record. At lunchtime we checked with

4 respect to the tapes made by Mr. West of Oxford Who's Who

5 employees. The postal inspector who was in charge of that

6 investigation now thinks there might be a couple of tapes

7 and he's retrieving the file from the coded file section.

8 THE COURT: Have him here tomorrow morning.

9 MR. WHITE: I'm sorry?

10 THE COURT: Have them here tomorrow morning.

11 MR. WHITE: I don't know if that's possible but

12 he's trying to do that.

13 THE COURT: All right.

14 MR. WHITE: The other thing, I think is it

15 inconsequential but I wanted to make sure it is clear. At

16 the bench this morning I indicated that I wasn't at the Success Shortcuts Path

17 U.S. Attorney's Office when Mr. West's case was closed.

18 That's not correct. I wasn't there when he pled guilty, I

19 was there when he was sentenced, for what it is worth.

20 THE COURT: You have clarified it.

21 MR. WHITE: Thank you.

22 MR. TRABULUS: Your Honor, one other thing. We

23 believe Mr. Watstein-West testified in litigation brought
24 by Reed Elsevier, relating to things about his company and
25 we have a reason to believe some of the testimony he gave

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4592

1 there might have been inconsistent with what he said

2 today. I don't know if the government has copies of any

3 of that testimony in their possession but if they do it

4 would be 3500 material.

5 MR. WHITE: I don't have any such thing. I'm

6 wondering why Mr. Trabulus says if it is inconsistent

7 would have reason to doubt it.

8 MR. TRABULUS: There might have been a statement

9 in one of Mr. Biegelman's affidavits that appears to be

10 inconsistent, but I'll look into it further.

11 THE COURT: If they don't have it you will have

12 to get it yourselves.

13 (Proceedings adjourned.)

14

15

16

17

18

19

20

21

22

23
24
25

OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
4593

1 I-N-D-E-X

2
W-I-T-N-E-S-S-E-S
3
PAGE LINE
4 W I L M A P I N C H A M..................... 4313 13
DIRECT EXAMINATION............................... 4313 22
5 CROSS-EXAMINATION................................ 4323 1
CROSS-EXAMINATION................................ 4332 8
6 CROSS-EXAMINATION................................ 4352 19
REDIRECT EXAMINATION............................. 4363 1
7 RECROSS-EXAMINATION.............................. 4367 13
RECROSS-EXAMINATION.............................. 4374 23
8
S T E V E N W A T S T E I N.................. 4379 9
9 DIRECT EXAMINATION............................... 4380 1
CROSS-EXAMINATION................................ 4416 19
10 CROSS-EXAMINATION................................ 4466 6
CROSS-EXAMINATION................................ 4579 10
11

12 E-X-H-I-B-I-T-S

13
Government's Exhibit 3-D received in evidence.... 4316 3
14 Government's Exhibit 3-B received in evidence.... 4319 19

15 Defendant's Exhibit AK received in evidence...... 4474 23
Defendant's Exhibit AL received in evidence...... 4520 11
16 Defendant's Exhibit AM received in evidence...... 4564 6
Defendant's Exhibit AN received in evidence...... 4574 23
17

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OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
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The Who's Who Worldwide Registry websites are focused on The Who's Who Debacle and Tragedy, and the double scandal of government and judicial corruption in one of the Imbalanced Trials of the Century and the concomitant news media blackout regarding this incredible story.

Sixteen weeks of oft-explosive testimony, yet not a word in any of 1200 news archives. This alone supports the claim that this was a truly corrupt federal trial; in fact, one of the most shamefully corrupt federal trials.

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The Who's Who Debacle and Tragedy
Thomas FX Dunn has got to count high on the list of "Laziest Lawyer In America"

Imbalanced Trials of the Century   - The Who's Who Debacle and Tragedy