381 F.2d 114 (2nd Cir. 1967), 477, United States v. Deaton

Docket Nº:477, 31147.
Citation:381 F.2d 114
Party Name:UNITED STATES of America, Appellee, v. Charles W. DEATON, Appellant.
Case Date:July 28, 1967
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit
 
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Page 114

381 F.2d 114 (2nd Cir. 1967)

UNITED STATES of America, Appellee,

v.

Charles W. DEATON, Appellant.

No. 477, 31147.

United States Court of Appeals, Second Circuit.

July 28, 1967

Argued June 8, 1967.

Page 115

Charles J. Fanning, Asst. U.S. Atty., Southern Dist. of New York (Robert M. Morgenthau, U.S. Atty., and David M. Dorsen, Asst. U.S. Atty., Southern District of New York, on the brief), for appellee.

Archibald Palmer, New York City, for appellant.

Before MOORE, FRIENDLY and ANDERSON, Circuit Judges.

ANDERSON, Circuit Judge:

Verdicts of guilty were returned by a jury on both counts of an indictment against Charles W. Deaton, charging him in the first count with fraud committed through interstate communication by wire, 18 U.S.C. § 1343, 1 and in the second count with interstate transportation of fraudulently obtained money, 18 U.S.C. § 2314. 2 Judgments of conviction were accordingly entered from which Deaton appeals.

There was evidence from which the following facts could have been found. The appellant held himself out as the Executive Secretary-Treasurer of International Insurance Company of Nassau,

Page 116

Ltd. In early 1964 he entered into negotiations with one Edward Johnson concerning a mortgage loan of $900,000 to be made by International to the Golden Mortgage & Investment Company, a joint venture composed of Johnson, Robert Pribble, and Harold Dragoo, which planned to use the borrowed funds for the acquisition and improvement of land in Colorado. The appellant demanded a fee of 3% Upon delivery of the written loan commitment and 3% At the closing. He agreed, however, to Johnson's request that only 1% ($9,000) be paid on the date of the commitment and that the balance of $18,000 be paid a few days later. This arrangement was made so that Johnson could pay the $18,000 on behalf of the Golden Company from a fee he expected to receive as a broker upon the closing of another loan by International to be made on April 27, 1964 to one C.E. Jesiop.

On April 24th in New York City, the appellant purported to commit International to make the $900,000 loan on May 20th; and he then demanded the first $9,000 installment on his fee. Johnson gave him a check for $1,000 in New York, and Pribble and Dragoo wired $7,968.39 from Colorado that same day. It was this telegraphic transfer of funds, inducted by appellant's representations and received by him at the Western Union office in the Empire State Building in New York City, which was the basis for the charges in the indictment. The Government sought to prove at the trial that on April 24th the appellant had no intention of completing a loan from International to the Golden Company because he knew that International could not and would not make it; and in fact no such loan was ever made.

As events developed after April 24th, the Jesiop loan was never actually closed, so that Johnson did not pay the appellant the remaining $18,000 installment on the commitment fee for the loan to the Golden Company, due on April 29th. The appellant put intensive pressure on Pribble and Dragoo to pay the $18,000 or at least a part of it. Dragoo's attorney became suspicious of the appellant and reported the matter to the F.B.I. On May 13th, an F.B.I. agent posing as Dragoo and another agent posing as his attorney met with the appellant and pretended to negotiate with him about the transaction. As the date for the commitment fee had passed, they requested Deaton to reinstate the loan commitment in writing in return for their check...

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