Benchwick v. United States, No. 17389.

CourtUnited States Courts of Appeals. United States Court of Appeals (9th Circuit)
Writing for the CourtPOPE, MERRILL and BROWNING, Circuit
Citation297 F.2d 330
Decision Date04 December 1961
Docket NumberNo. 17389.
PartiesStephen R. BENCHWICK, Appellant, v. UNITED STATES of America, Appellee.

297 F.2d 330 (1961)

Stephen R. BENCHWICK, Appellant,
v.
UNITED STATES of America, Appellee.

No. 17389.

United States Court of Appeals Ninth Circuit.

December 4, 1961.


297 F.2d 331

E. D. Crumpacker, Honolulu, Hawaii, for appellant. Crumpacker & Sperry, Honolulu, Hawaii, of counsel.

Herman T. F. Lum, U. S. Atty., Honolulu, Hawaii, for appellee.

Before POPE, MERRILL and BROWNING, Circuit Judges.

BROWNING, Circuit Judge.

The defendant, a depositor in the Aiea Branch of the Bank of Hawaii, was found guilty of having aided and abetted1 the Branch Manager in the willful misapplication of the funds of the Bank.2 The case was tried to the Judge, the defendant having waived a jury. The defendant's principal contention on this appeal is that the evidence was insufficient to sustain the conviction. The defendant also urges that the District Court erred: (1) in refusing to enter special findings of fact at the close of the government's case; and (2) in admitting evidence as to certain events which occurred subsequent to the period covered by the information. We have concluded that the evidence was sufficient and that there was no reversible error in the rulings referred to. We therefore affirm.

The essential facts are not in dispute. Late in 1958 the defendant began trading in the stock market. During the period December 19, 1958, through December 17, 1959, he drew 22 checks on his account at the Aiea Branch of the Bank of Hawaii payable to his broker for the purchase of securities. The first three checks were paid by the Bank and charged to the defendant's account in the normal manner. A fourth check in the amount of $10,848 was presented to the Bank early in April, 1959, when the balance of the defendant's account was only $2,242.21. The Branch Manager contacted the defendant, who agreed to come in and cover the check. The check was then paid. Instead of charging it to defendant's account where it would have created an overdraft of some $8,000, the Branch Manager charged it to a so-called Deferred Items account, used for temporary recording of items which for some reason could not be cleared immediately. Normally, items charged to Deferred Items remained in that account no longer than twenty-four hours, but the defendant's check was held there for eleven days, and was charged to the defendant's account only after the defendant had deposited sufficient funds to cover it.

The pattern thus initiated continued for a period of eight months. Seventeen of the 19 checks which were thereafter drawn by the defendant in favor of his

297 F.2d 332
broker were drawn on insufficient funds. Four of the 17, ranging in amounts from $18,133 to $60,325, were presented when the defendant's account was already overdrawn, and his balance when each of the remaining 13 checks was presented was generally only a fraction of the amount of the check. All 17 of the checks drawn on insufficient funds were charged to the Deferred Items account by the Branch Manager. The first 14 of these 17 checks were held in that account for periods averaging more than two weeks, and running as long as 27 days, until funds were received to pay them. They were then charged to the defendant's account. The last three checks remained in the Deferred Items account — they were never paid.3

Holding the defendant's checks in the Deferred Items account resulted in both concealment of the overdrafts and loss to the Bank. If charged to the defendant's account the checks would have appeared as overdrafts both in that account and in monthly overdraft reports to the Bank's central office. Aside from other steps which might have been taken, each overdraft would then have been subject to a penalty charge or interest, whichever was greater.

Two other affirmative acts of concealment by the Branch Manager were disclosed by the evidence: In May, while federal and state auditors were engaged in checking the Aiea Branch, two of defendant's checks totaling over $11,000 were transferred out of the Deferred Items account to a record status which indicated that they had been cleared from that account and returned to the head office, and the same procedure was followed again in December with respect to the final three checks totaling $82,850.

The defendant's argument as to the insufficiency of the evidence begins with two unimpeachable generalizations — first, that an intent to injure and defraud the bank is an essential element of the offense under 18 U.S.C. § 656. Evans v. United States, 153 U.S. 584, 592, 14 S.Ct. 934, 38 L.Ed. 830 (1894); Seals v. United States, 221 F.2d 243, 245 (8th Cir., 1955); and United States v. Wicoff, 187 F.2d 886, 890 (7th Cir., 1951); and, second, that since overdrafts may be the means of initiating a legitimate bank loan, the requisite intent "cannot be inferred, as a matter of law, from the mere fact that when the check was drawn there were not funds on deposit to meet the check * * *." Dow v. United States, 82 F. 904, 908 (8th Cir., 1897).4 The defendant suggests that the only evidence of the Branch Manager's intent to defraud the Bank was that he had manipulated the Bank's records so as to conceal the overdrafts. The Branch Manager affirmatively testified that he had not told the defendant about these irregular banking procedures. The defendant thus concludes that the only evidence that he shared the Branch Manager's fraudulent intent was the fact that he knowingly submitted checks in excess of his balance — which was not adequate proof of intent under the rule of the Dow case.

An aider and abettor must, of course, know that a wrong is to be committed, United States v. Turnipseed, 272 F.2d 106, 107 (7th Cir., 1959). However, it is not necessary that he know the modus operandi of the person whom he is charged with aiding and abetting. McClanahan v. United States, 230 F.2d 919, 924 (5th Cir., 1956); Russell v. United States, 222 F.2d 197, 199 (5th Cir., 1955). It would have been sufficient in the present case to show that the defendant shared the Branch Manager's criminal purpose to injure and defraud the

297 F.2d 333
Bank. Hall v. United States, 286 F.2d 676, 680 (5th Cir., 1960); Morei v. United States, 127 F.2d 827, 831 (6th Cir., 1942). Knowledge of the Branch Manager's specific acts of concealment would have been relevant evidence that defendant had the requisite intent, but it was not the only possible evidence

The District Court specially found that the defendant knew that the Branch Manager "willfully mishandled or concealed the defendant's checks contrary to bank regulations or made false entries in order to misapply money of said Bank for the use and benefit of the defendant, with intent to injure said Bank," — and this finding was amply supported by the record. (1) The repeated drawing and payment of checks over an extended period in amounts grossly in excess of the defendant's balance was itself a relevant circumstance bearing upon defendant's knowledge and intent.5 (2) Defendant admittedly knew that the Branch Manager's conduct gave him the use of substantial amounts of the Bank's money during the periods in which the checks were held. He paid no interest for the use of these funds and gave no security for their repayment. During the same period the defendant arranged a number of both secured and unsecured loans with the Bank. In each instance, he was required to provide security for loans of any substantial amount and he was charged interest on all loans, secured or unsecured. Although the defendant's largest loan was for $14,000, secured by a mortgage on his home, and his largest unsecured loan was for $1,156.88, the checks at issue ranged as high as $70,400. It must have been obvious to the defendant that the advances made to him by the withholding of his checks vastly exceeded his reasonable credit. (3) It appeared from the face of his monthly bank statements, introduced by defendant at the trial, that the checks involved in his stock transactions were handled in an irregular manner. Overdrafts appeared on his statements in red and were subject to a charge. But the checks involved here, though normally far in excess of his balance, did not appear on his statement at all until he had arranged to pay them. On a number of occasions his deposit, when finally made, did not quite meet the outstanding check, so that the appearance of the deposit and of the withheld check simultaneously on his statement left a small overdraft. In these instances, the deficiency appeared in the defendant's bank statement as a normal overdraft, though, as defendant must have known, the overdraft thus recorded represented only a small part of the...

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60 practice notes
  • U.S. v. Duncan, Nos. 77-2606
    • United States
    • United States Courts of Appeals. United States Court of Appeals (4th Circuit)
    • May 10, 1979
    ...of funds within the meaning of the statute. See United States v. Caldwell, 544 F.2d at 696-97; Cf. Benchwick v. United States, 297 F.2d 330 (9th Cir. 1961) (closely analogous practice; aiding and Defendant also contends that no conversion could have occurred because the method in which he o......
  • U.S. v. Haldeman, Nos. 75-1381
    • United States
    • United States Courts of Appeals. United States Court of Appeals (District of Columbia)
    • December 8, 1976
    ...with the required specific intent. Tr. 12407. 234 Gallion v. United States, 386 F.2d 255, 257 (9th Cir. 1967); Benchwick v. United States, 297 F.2d 330, 333 (9th Cir. 1961); Hall v. United States, 286 F.2d 676, 680 (5th Cir. 1960); United States v. Nystrom, 237 F.2d 218, 225 (3d Cir. 1956);......
  • Verdugo v. United States, No. 20803.
    • United States
    • U.S. Court of Appeals — Ninth Circuit
    • October 7, 1968
    ...approval in United States v. Calderon, 348 U.S. 160, 164 n. 1, 75 S.Ct. 186, 99 L.Ed. 202 (1954); see also Benchwick v. United States, 297 F.2d 330, 335 (9th Cir.1961); Maulding v. United States, 257 F.2d 56, 58, 17 Alaska 592 (9th Cir. 1958). Since we do not rely upon Verdugo's testimony, ......
  • Stuebgen v. State, No. 4325
    • United States
    • United States State Supreme Court of Wyoming
    • April 12, 1976
    ...210, 437 P.2d 962, 31 A.L.R.3d 830, 843 (1968); Bryant v. State, 4 Md.App. 572, 244 A.2d 446, 450 (1968); Benchwick v. United States, 297 F.2d 330, 333 (9th cir. 1961); People v. Fruci, 188 Misc. 384, 67 N.Y.S.2d 512 (1947); and 22 C.J.S. Criminal Law §§ 32-33. 'Whenever a statute makes an ......
  • Request a trial to view additional results
60 cases
  • U.S. v. Duncan, Nos. 77-2606
    • United States
    • United States Courts of Appeals. United States Court of Appeals (4th Circuit)
    • May 10, 1979
    ...of funds within the meaning of the statute. See United States v. Caldwell, 544 F.2d at 696-97; Cf. Benchwick v. United States, 297 F.2d 330 (9th Cir. 1961) (closely analogous practice; aiding and Defendant also contends that no conversion could have occurred because the method in which he o......
  • U.S. v. Haldeman, Nos. 75-1381
    • United States
    • United States Courts of Appeals. United States Court of Appeals (District of Columbia)
    • December 8, 1976
    ...with the required specific intent. Tr. 12407. 234 Gallion v. United States, 386 F.2d 255, 257 (9th Cir. 1967); Benchwick v. United States, 297 F.2d 330, 333 (9th Cir. 1961); Hall v. United States, 286 F.2d 676, 680 (5th Cir. 1960); United States v. Nystrom, 237 F.2d 218, 225 (3d Cir. 1956);......
  • Verdugo v. United States, No. 20803.
    • United States
    • U.S. Court of Appeals — Ninth Circuit
    • October 7, 1968
    ...approval in United States v. Calderon, 348 U.S. 160, 164 n. 1, 75 S.Ct. 186, 99 L.Ed. 202 (1954); see also Benchwick v. United States, 297 F.2d 330, 335 (9th Cir.1961); Maulding v. United States, 257 F.2d 56, 58, 17 Alaska 592 (9th Cir. 1958). Since we do not rely upon Verdugo's testimony, ......
  • Stuebgen v. State, No. 4325
    • United States
    • United States State Supreme Court of Wyoming
    • April 12, 1976
    ...210, 437 P.2d 962, 31 A.L.R.3d 830, 843 (1968); Bryant v. State, 4 Md.App. 572, 244 A.2d 446, 450 (1968); Benchwick v. United States, 297 F.2d 330, 333 (9th cir. 1961); People v. Fruci, 188 Misc. 384, 67 N.Y.S.2d 512 (1947); and 22 C.J.S. Criminal Law §§ 32-33. 'Whenever a statute makes an ......
  • Request a trial to view additional results

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