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02-1443 U.S. v. Turner

By: dmc-admin//August 26, 2002//

02-1443 U.S. v. Turner

By: dmc-admin//August 26, 2002//

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“The business of insurance does affect interstate commerce. Turner asserts that his activities did not directly affect interstate commerce, therefore, Congress’ prohibition of insurance embezzlement is ultra vires. Turner asks us to divide his actions from those engaged in by Allstate. However, we do not look solely at Turner’s crime, as he would have us do; rather, we look to the ‘class of activities’ and determine their ‘total incidence’ on interstate commerce. Perez, 402 U.S. at 153-54; Maryland v. Wirtz, 392 U.S. 183, 193 (1968); see also 18 U.S.C. secs. 1033(a)(1), (b)(1) (‘the business of insurance whose activities affect interstate commerce.’). If embezzlement affects the business of insurance, positively or negatively, then Congress may also regulate that activity as incident to regulating the business of insurance. E.g., Perez, 402 U.S. at 150-55; Wickard, 317 U.S. at 125. Turner’s crime may be local and have only an indirect effect on commerce; nevertheless, the activity may be reached by Congress by virtue of the fact that it affects Allstate’s business – which, in turn, affects interstate commerce – or in the aggregate, embezzlement may negatively effect and destabilize the entire insurance industry.

Perez, 402 U.S. at 150-56; Wickard, 317 U.S. at 125; Black, 125 F.3d at 460- 61 (holding that ‘Congress can criminalize [the failure to pay child support] just as it has other impediments to interstate commerce.’). In fact, Congress enacted 18 U.S.C. sec. 1033 for the purpose of preventing the destructive aggregate effects of embezzlement by multiple employees, agents, and officers throughout the insurance industry, in order to preclude another crisis akin to the massive savings and loan failures of the 1980s. H.R. REP. NO. 103- 468.”

Affirmed.

Appeal from the United States District Court for the Northern District of Illinois, Coar, J., Bauer, J.

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