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UNITED STATES v. WOODS

November 1, 1965

UNITED STATES of America
v.
John WOODS and Julius Cooperman



The opinion of the court was delivered by: DUMBAULD

 On June 15, 1965, both defendants, John Woods and Julius Cooperman, were found guilty by a jury under Counts 5, 7, 10, and 11b of violations of 18 U.S.C. § 1010. At the same time the defendants were found not guilty under Counts 1, 2, 8, 11a, and 12 of the indictment. The original indictment was in twelve counts, but the other counts were withdrawn from the jury pursuant to rulings of the Court.

 18 U.S.C. § 1010 reads as follows:

 
" Whoever, for the purpose of obtaining any loan or advance of credit from any person, partnership, association, or corporation with the intent that such loan or advance of credit shall be offered to or accepted by the Federal Housing Administration for insurance, or for the purpose of obtaining any extension or renewal of any loan, advance of credit, or mortgage insured by such Administration, or the acceptance, release, or substitution of any security on such a loan, advance of credit, or for the purpose of influencing in any way the action of such Administration, makes, passes, utters, or publishes any statement, knowing the same to be false, or alters, forges, or counterfeits any instrument, paper, or document, or utters, publishes, or passes as true any instrument, paper, or document, knowing it to have been altered, forged, or counterfeited, or willfully overvalues any security, asset, or income, shall be fined not more than $5,000 or imprisoned not more than two years, or both."

 It will be noted that the elements of the offense, which must be proved by the Government beyond a reasonable doubt, include the following: (1) Defendant's act : (a) The defendant must make, pass, utter, or publish a statement; which defendant knows to be false. (b) Another act punishable is wilfully overvaluing any security, asset or income. (2) Defendant's purpose : Whichever of the foregoing acts is committed, it must be done (a) with the specific intent or purpose of obtaining a loan or advance of credit from a financial institution with the intent that such loan or advance of credit shall be offered to or accepted by the Federal Housing Administration for insurance, (b) or for the purpose of influencing in some way the action of that agency.

 Thus for the conviction to stand there must be sufficient evidence to sustain a verdict that each of the defendants made or passed a statement, knowing the same to be false, with the intent or purpose of obtaining a federally insured loan or of influencing the action of the Federal Housing Administration; or wilfully overvalued a security or asset with the same intent. The Court so charged (Tr. 306-310). Mention of the particular counts on which convictions occurred was made by the Court at pages 313-315.

 With regard to Count 5, Berta testified (Tr. 118) that his wages were $350.00 a month, and they were stated on the printed application (Exhibit 11A) as $550.00. Both Cooperman and Woods signed this application as salesmen. Berta testified (Tr. 115) that both men came to the house.

 There is, therefore, sufficient evidence against both defendants to sustain the conviction under Count 5.

 Under Count 7, Denney testified (Tr. 189) that he bought his home in 1960 for $9100.00, whereas on the credit application Exhibit 14b the date is given as 1956 and the price $15,000.00. This application is signed by Cooperman alone as salesman.

 In this connection it may be noted that the application shows a mortgage debt outstanding of $11,500.00, so that a value of only $9100.00 might not have looked good.

 On cross-examination Denney testified that actually he had not received a deed to the home but it was being purchased on Articles of Agreement (Tr. 201). Defendants strenuously contend that by reason of this fact it is not a false statement to give the date of purchase and price paid incorrectly, inasmuch as in fact there was no purchase and there was no purchase price. However, the form for the credit application in the line below the one filled in contains a line reading "Is being bought on contract by" with a blank for price paid. Consequently, strictly speaking, it would be a false statement to fill in the blanks which were filled in rather than those on the line below, in view of the facts.

 The date of purchase (in view of inflation) and the price paid are both significant data in connection with any determination of the value of the asset (residence property) involved. Did the defendants "wilfully overvalue" this asset? The jury's verdict would have to be taken as conclusive on the issue of wilfulness. Was there overvaluation by them?

 Strictly speaking defendants did not place any valuation on this asset. They simply made or passed false statements regarding matters relevant to valuation and from which an inference as to valuation ...


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