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United States v. Scalzitti

argued: January 4, 1978.

UNITED STATES OF AMERICA
v.
JOHN EDWARD SCALZITTI, ET AL. JOHN SCALZITTI, APPELLANT IN NO. 77-1861 THOMAS FANELL, APPELLANT IN NO. 77-1862 LOUIS J. MARICONDI, APPELLANT IN NO. 77-1863



ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA.

Seitz, Chief Judge, Gibbons and Garth, Circuit Judges.

Author: Seitz

SEITZ, Chief Judge.

Defendants appeal the judgments of the district court entered after a jury found them guilty on several counts of making false statements in a loan application to a federally insured bank in violation of 18 U.S.C. § 1014 (1976), and of aiding and abetting the same in violation of 18 U.S.C. § 2 (1976).

I.

We first consider the contentions of one of the defendants, Fanell, that there was insufficient evidence to create a jury issue as to the charges that he violated 18 U.S.C. § 1014, or that he aided and abetted others in violating that statute. Section 1014 provides in pertinent part:

Whoever knowingly makes any false statement or report . . . for the purpose of influencing in any way the action of . . . any bank the deposits of which are insured by the Federal Deposit Insurance Corporation . . . upon any application, advance, discount, purchase, purchase agreement, repurchase agreement, commitment, or loan, or any change or extension of any of the same, by renewal, deferment of action or otherwise, or the acceptance, release, or substitution of security therefor, shall be fined not more than $5,000 or imprisoned not more than two years, or both.

18 U.S.C. § 1014 (1976).

Defendant Fanell was found guilty under two counts of the indictment, both of which alleged that he "knowingly did make, and cause to be made, materially false statements in an application for a loan submitted by the defendants . . . to the Mellon Bank . . . a bank the deposits of which are insured by the Federal Deposit Insurance Corporation, for the purpose of influencing the action of said bank to approve said loan."

Both sides agree that the Government had the burden of proving, inter alia, that Fanell knowingly aided and abetted the defendant Scalzitti in making a false statement to the Mellon Bank. They differ as to whether the Government made a sufficient showing on that point.

The evidence shows that Fanell was an experienced businessman and truck dealer who owned a firm known as National Fleet Recon Center, which repaired and reconditioned trucks. Fanell signed two forms granting powers of attorney to one William Berns. Those powers of attorney gave Berns authority to act for Fanell in "all transactions including financing agreements" in connection with the purchase and sale of motor vehicles. Berns managed the used-car operation at Jon's Oldsmobile-Cadillac, Inc. That car dealership was owned by defendant Scalzitti, who was a friend of Fanell.

The powers of attorney were dated on a Sunday, February 18, 1973, and they purported on their face to have been notarized that same Sunday by one Genevieve Cox, an employee of the car dealership. The dealership, however, was in fact closed on Sunday and Genevieve Cox was not at work on that date.

Five days after the date shown on the powers of attorney, Jon's Oldsmobile-Cadillac made a number of loan applications to the Mellon Bank. Two loans were granted by the Bank on the basis of representations that specific cars had been sold by Jon's Oldsmobile-Cadillac to National Fleet, which was owned by Fanell. The powers of attorney granted by Fanell to Berns were used to support those loan applications. The undisputed proof showed that it was falsely represented that these cars had been sold to Fanell's company.

Does the introduction of this evidence at trial permit a reasonable inference that Fanell knowingly aided and abetted the filing of a false loan application? The Government contends that the unusual relationships of the parties, and the proximity of the date of the execution of the powers of attorney to the date of the applications for the loans, warranted the jury in finding the requisite knowledge on Fanell's part. Fanell contends that no reasonable inference was permissible that he was aware that the powers of attorney would be used in making false statements to a bank.

The powers of attorney were executed under "unusual circumstances." Furthermore, the recipient of the powers managed the used-car division of a car dealership owned by a friend of Fanell. Fanell, on the other hand, operated only a truck dealership. The powers were used within five days after their date of execution as part of a fraudulent scheme to obtain money from a bank. Moreover, that fraudulent scheme was in connection with a "financing agreement" as specifically mentioned in the powers of attorney. Given these circumstances, we think it was permissible for a jury to infer that Fanell was aware when he delivered the powers of attorney that those powers were to be used for the illicit purpose which eventuated.

Fanell relies upon United States v. Cades, 495 F.2d 1166 (3d Cir. 1974). Cades, however, is distinguishable. In that case, there was no evidence of any connection between the defendant and the illegal acts of the person whom the defendant was accused of aiding and abetting. Here we find that there was sufficient evidence introduced at trial of a connection between Fanell and the illegal acts at issue to permit a ...


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