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United States v. Nystrom

decided: September 20, 1956.


Author: Mclaughlin

Before GOODRICH and McLAUGHLIN, Circuit Judges, and VAN DUSEN, District Judge.

McLAUGHLIN, Circuit Judge.

These appellants were jointly indicted, tried and convicted of misapplication of bank funds under Title 18 U.S.C.A. ยง 656 and of conspiracy to misapply bank funds.

Miss Nystrom was a teller of the Union National Bank at McKeesport, Pennsylvania; she had been employed by the bank fourteen years. Kennedy was a depositor of the bank. He was in the automobile truck and used car business, sold motor parts and accessories and was a wholesale and retail gasoline dealer.

There were three indictments. No. 13,662 related to fictitious deposit slips. It originally contained twenty-two counts. Of these, Counts Two, Sixteen and Twenty-Two were eliminated by judgments of acquittal being entered on them at the end of the government's case. No. 13,664 dealt with the payment of Kennedy payroll checks from Union Bank funds without Kennedy having sufficient credit balance to cover those payments. Judgment of acquittal was entered on all counts of this indictment after the government had concluded its presentation in chief. The last indictment, No. 13,665, in five counts charged misapplication of bank funds by honoring Kennedy checks where his account lacked sufficient funds to pay them. The Sixth Count alleged conspiracy to misappropriate bank funds in violation of Section 656 through Kennedy making and issuing checks on his accounts and Miss Nystrom honoring and paying them when the particular accounts did not have sufficient credit balances to pay them. It was also alleged as part of the conspiracy that Miss Nystrom would make deposit slips indicating Kennedy deposits when in fact they had not been made. There were eight overt acts set out as part of the conspiracy, the first four regarding false deposits and the balance charging payment of checks when there were not sufficient funds for that purpose. Judgment of acquittal was granted on the first five counts of this indictment and that part of Count Six covering the "not sufficient funds" checks together with the related overt acts.

Appellants were convicted on all of the remaining counts. Motions for judgments of acquittal and new trial were thereafter denied.

The theory of the government was that Kennedy had aided and abetted the Union Bank employee, Miss Nystrom, to misapply the bank's funds and that the two of them conspired in the years 1948, 1949 and 1950 to misapply those funds. Their method, as charged, was to make spurious deposit tickets to the Kennedy accounts in order to pad them and so take care of Kennedy's "not sufficient funds" checks or overdrafts in the bank, all with the intent to injure and defraud the bank; finally, contended the government, because of a then pending merger of the Union Bank and the Peoples Bank of McKeesport, with Miss Nystrom knowing of an expected audit of the two banks, she staged or faked a holdup to cover up a shortage of $58,744.

The so-called robbery was alleged to have occurred January 8, 1951 during banking hours. Around two o'clock that afternoon Miss Nystrom reported to her superior, C. E. Anderson, she had been held up at her cage and robbed some fifteen minutes previously. An F.B.I. agent talked with Miss Nystrom that same day about 3:45 p.m. He said she told him that just prior to the holdup she was waiting on three customers at her cage; that there was a line of customers at that cage and that they took their turn as they stepped up to make deposits and transact business; that one of the customers who stepped up in his turn was a man who carried in his left hand a brown canvas bag, a note written on brown wrapping paper and some fifty-dollar bills which he started to push through under the grille work in the teller's cage; that because of this bag she thought that it was a customer such as other customers who come into the bank for change with which to transact business, so she opened the grille work of the teller's cage. As the man pushed the bag, note and fifty-dollar bills in on the counter in front of her, he said to her, "This is what I want." She picked up the fifty-dollar bills from the top of the note and glanced at the note; that to the best of her recollection it was written on what appeared to be brown wrapping paper and that the words "This is a stick-up" were written on this brown wrapping paper with what appeared to her to be black crayon. She said as soon as she read this note she glanced up and this man had a gun pointed at her which he held in his right hand. He told her, "I want the money in the drawer behind you." She immediately turned and started to put the money in the canvas bag which he had placed on the counter and when she handed the bag to him he said to her not to make a move before 3:00 o'clock because she was being watched. He turned and walked slowly toward the front door of the bank. She said she watched him as he left the teller's cage, then she turned around and glanced back to the line of the customers in front of her and a woman stepped up to the cage. The grille work was still open from the man having been there and the woman stepped up immediately saying, "I will take some of that, too." She carried what Miss Nystrom described as a knitting bag with wooden handles; facing Miss Nystrom she stepped up to the cage holding the bag in her left hand and in her right hand, which she put into the bag, she carried a small gun.Miss Nystrom reached in the teller's drawer to her left and picked up some fifty and one hundred dollar bills and handed them to the woman who then said, "I will take that wallet, too," indicating a wallet lying on the shelf above a work-table behind Miss Nystrom. The latter turned and picked up her wallet, handed it to the woman who dropped it in the knitting bag. The woman made no further remarks to Miss Nystrom and turned and walked toward the front door of the bank. Both the man and the woman walked slowly and appeared to be in no hurry whatsoever to get out of the bank. At that time Miss Nystrom noticed a man standing near the night depository in the front corner of the bank, and this man appeared to be looking at her but he paid no attention to the two alleged robbers as they walked past. She assumed this man was the person who had been left there to watch her as had been threatened by the alleged male robber who first came to her window.

The agent asked Miss Nystrom about the robber's note. He stated that at first she was unable to recall just what had happened to it. It could not be located in the vicinity of her cage and Miss Nystrom about that time said she recalled that she thought the man had reached in and taken the note back and put it in his pocket.

Miss Nystrom was asked if she could identify and of the bank's customers who immediately preceded or followed the alleged robbers. She was unable to recall any of them either before or after the robbery at any time.

None of the above testimony was denied by Miss Nystrom who was a trial witness.

As a result of the intensive investigation, out of 500 persons interviewed, approximately 60 bank employees and customers were found who were in the bank around the time Miss Nystrom said she had been held up. None of these saw or heard anything unusual and so stated at the trial. Nor was any other evidence discovered in substantial support of the robbery story and no one was located who answered Miss Nystrom's description of the thieves. All this brought about a check of the accounting records of the bank and Kennedy. The irregularities disclosed produced the indictments.

Appellants contend there was not sufficient evidence to support their convictions. We must disagree, for on both the substantive and conspiracy counts the government presented a case that entitled it to go to the jury and justifies the verdicts of that tribunal.

There was testimony that the practice at the bank in some instances prior to October or November 1949 would be to give back to the teller handling it, and charging it to him, a "not sufficient funds" check if he advised there was a deposit coming in. The person in charge of those checks said, Miss Nystrom, who took care of the Kennedy accounts, got some of that type of Kennedy checks; she did not believe anyone else ever took any of the Kennedy checks. After October or November, 1949, that system was discontinued and only the chief teller could hold NSF checks. There was evidence from bank bookkeepers, ...

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