United States v. Pesano, 397

• Decision Date: 02 August 1961
• Docket Number: No. 397,Docket 26520.,397
• Citation: 293 F.2d 229
• Parties: UNITED STATES of America, Appellee, v. Peter C. PESANO, Appellant.
• Court: U.S. Court of Appeals — Second Circuit

293 F.2d 229 (1961)

UNITED STATES of America, Appellee, v. Peter C. PESANO, Appellant.

No. 397, Docket 26520.

United States Court of Appeals Second Circuit.

Argued June 8, 1961.

Decided August 2, 1961.

Thomas J. Todarelli, New York City (Sabbatino & Todarelli, New York City, on the brief; Peter L. F. Sabbatino, New York City, of counsel), for appellant.

Thomas Day Edwards, Asst. U. S. Atty., Southern Dist. of New York, New York City (Robert M. Morgenthau, U. S. Atty., and Gerald Walpin, Asst. U. S. Atty., New York City, on the brief), for appellee.

Before LUMBARD, Chief Judge, and GOODRICH^* and FRIENDLY, Circuit Judges.

GOODRICH, Circuit Judge.

The appellant was convicted on four counts of an indictment charging, in four separate instances, the making of false statements in documents prepared for the purpose of securing loans to be insured by the Federal Housing Administration. See 18 U.S.C. § 1010. He was sentenced to two years imprisonment on each of the four counts but the sentences are to run concurrently. There are four transactions in which the defendant had participated during which he was alleged to have made false statements which violated the terms of the statute. There was ample evidence to support the jury's findings that the false statements were made and that they were knowingly made. Indeed, this is not seriously challenged by the defendant on this appeal.¹

The chief argument made on behalf of the appellant is that the court did not correctly charge as to the intent necessary to convict him under the statute. The Government puts his complaint to the effect that the intent required is one "fraudulently to subject the Government's insurance funds to risk of loss."² It is conceded in this case that whether representations were false or not there has not been, in the case of any of the four loans under consideration, any failure on the part of the borrower to meet the terms of the loans. In other words, the insurance funds have not suffered any pecuniary loss through what the defendant has done regardless of the risk which may have been created by false representations at the time the loans were made.

There are two good reasons why the appellant's complaint about the charge made by the Court avails nothing. One is that he took no exception to the charge and, indeed, submitted a point himself which the court adopted.³ This will be discussed in a moment. The second is that regardless of the exception or no exception the charge was right.

Let us turn first to the statute. 18 U.S.C. § 1010 provides:

"Whoever, for the purpose of obtaining any loan * * * from any person, * * * with the intent that such loan * * * shall be offered to or accepted by the Federal Housing Administration for insurance * * * makes * * * any statement, knowing the same to be false * * * shall be fined not more than $5,000 or imprisoned not more than two years, or both."

The very capable trial judge told the jury about the necessary intent in these words:

"This statute has nothing whatever to do with defrauding the Government or whether or not the Government is actually defrauded. This statute is pinpointed at the application for the loans. It makes it a criminal offense to make a false statement in those applications, knowing it to be false. It is the purpose of this statute to allow the government officials who insure these loans to rely on the applications and the representations made in those applications in making a determination as to whether or not the loan should be insured under Title I of the Federal Housing Act.

* * * * * *

"Further, this application or this statement in the application or other form supplied by the government in connection with these loans must be for the purpose of obtaining a loan; that is the third element of the offense; it must be proved to your satisfaction that the false statement, the knowing false statement, was made for the purpose of obtaining a loan from a bank or other lending institution, for example."

Then, at the defendant's request, he added this:

"Intent is a necessary ingredient of the offense. Whether such intent existed is a question of fact with sic which the jury must exclusively find from the facts and all the surrounding circumstances.

"If you find that the defendant acted by mistake, inadvertence or other innocent reason, then he cannot be charged with knowingly committing the offense."

We think the charge given by the trial judge was just right. The statute requires the false representation to be made knowingly. It says nothing about intent to inflict pecuniary loss upon the United States. It penalizes knowingly false statements. If there had been anything lacking in the charge, and we do not think there was, it was clearly supplied by the further instruction given and quoted above. The appellant's counsel in oral argument complained that this was a watered down description of the intent necessary and lost its force by being given at the end of the charge. We think the contrary. It was the very last thing the jury had before it retired. The interpretation made by the trial judge of what we think is a pretty clear wording of the statute is borne out by the following cases. Steingold v. United States, 6 Cir., 1958, 262 F.2d 1, (statements "knowingly made incorrect in order to influence favorable action by the FHA" constitute the "essence of the crime." Id., at page 2.); Smith v. United States, 6 Cir., 1956, 230 F.2d 935 ("Two basic elements of the crime are the making of a material false statement and the knowledge of the maker that the statement is false." Id., at page 938. We understand the court's statement about "criminal motive" and "guilty mind" to apply to the knowingly false statement. Ibid.); C.I.T. Corp. v. United States, 9 Cir., 1945, 150 F.2d 85 ("Knowledge of falsity and a purpose, that is, intent to use the falsehood...