State v. Childs
576 A.2d 42, 242 N.J. Super. 121 (1990)
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Rule of Law:
Under N.J.S.A. 2C:20-2b(4), the monetary amounts of multiple thefts may be aggregated into a single, higher-grade offense if they were committed pursuant to one scheme or course of conduct; charging this single aggregated offense in one count of an indictment is not duplicitous.
Facts:
- Richard Childs owned and controlled Supreme Newark, Inc., a corporation that sold furniture on credit at a 300% markup but consistently operated at a loss.
- To generate cash, Childs solicited loans for his corporation by issuing short-term, high-interest unsecured notes to an expanding group of investors.
- Childs induced these investments by making false representations, including claims that the notes were AAA-rated, the corporation was profitable, and a major university was an investor.
- Childs also persuaded Charles Provini and his company, Chalis, Inc., to provide cash for factoring the corporation's credit paper.
- Childs falsely represented to Chalis that its investments were secured by segregated credit paper, when in fact he was selling all valuable paper to other commercial factors.
- The scheme collapsed when Provini attempted to withdraw funds and discovered the corporation had neither cash nor the promised credit paper to give him.
- Eventually, the commercial factors forced Childs' corporation into bankruptcy.
Procedural Posture:
- A New Jersey state grand jury returned a three-count indictment charging Richard Childs and Supreme Newark, Inc. with theft by deception and forgery.
- In the trial court, the judge granted the defendant's motion to dismiss the entire indictment, finding that a deputy attorney general's conduct had infringed upon the grand jury's independence.
- The trial court judge also dismissed Count One of the indictment on the alternative ground that it was duplicitous because it aggregated thefts from twenty different victims into a single charge.
- The State, as plaintiff-appellant, appealed the trial court's dismissal order to the Superior Court of New Jersey, Appellate Division.
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Issue:
Does aggregating the amounts of multiple thefts committed pursuant to a single scheme or course of conduct into one count of an indictment render that count duplicitous?
Opinions:
Majority - Brody, J.A.D.
No. An indictment that aggregates multiple thefts into a single count is not duplicitous if the thefts were committed 'pursuant to one scheme or course of conduct' as permitted by N.J.S.A. 2C:20-2b(4). The statute allows a grand jury to charge a single, higher-degree theft by combining the amounts of separate, lesser thefts that are part of a single criminal venture. In such a charge, the individual thefts are not being alleged as separate and distinct offenses within the same count; rather, they are constituent elements of the single aggregated offense. The court analogized this to a conspiracy charge, which is not duplicitous even if it lists several distinct criminal objectives. Therefore, Count One, which aggregated thefts from twenty noteholders, and Count Two, which aggregated thefts from Chalis, Inc., were both permissible under the statute.
Analysis:
This decision solidifies the use of New Jersey's theft aggregation statute, N.J.S.A. 2C:20-2b(4), as a powerful tool for prosecuting complex financial crimes. It clarifies that charging a series of related thefts as a single, aggregated offense does not violate the rule against duplicity. This allows prosecutors to frame charges in a way that reflects the overall scale and criminality of a defendant's conduct, such as in a Ponzi scheme, rather than being forced to litigate dozens of smaller, individual thefts. The ruling provides procedural guidance for trial courts on how to instruct juries and structure verdict sheets in cases involving aggregated theft charges, ensuring that the jury properly determines whether the individual acts were part of a single scheme.
