00-1215 U.S. v. Kosth

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“Although Kosth attacks the sufficiency of the evidence of sham ownership, we are satisfied that there was enough evidence in the record to support the jury’s decision to accept the government’s version of events. There was ample evidence to support findings that Hillcrest Resorts, Inc., was Kosth’s idea; that because of the terms of his probation, he needed a way to conceal his ownership interest in Hillcrest when dealing with financial institutions and the SBA; and that he used his wife for this purpose. Among the most compelling evidence that he was the true owner of the stock was the stock reversion agreement that provided that Terri Kosth’s stock would revert to the corporation in the event of Daniel Kosth’s death. It was also telling that Daniel Kosth regularly voted his wife’s shares, that Terri played no role in the management of the business, and that she acquired 90% of ‘her’ stock interest through in-kind contributions of building materials, goods which Daniel Kosth, as owner of a construction company, was well positioned to supply. This evidence, when considered in conjunction with the extensive evidence of Kosth’s control over the day-to-day operations of Hillcrest, supports the jury’s conclusion that Kosth was the true part-owner and manager of Hillcrest, that he knew this to be the case when he filled out the SBA loan application, and that he made the false statement with the intention of obtaining an SBA loan which he realized he was otherwise unlikely to get.”

Affirmed.

Appeal from the United States District Court for the Central District of Illinois, Mihm, J., Wood, J.