United States v. Rickert, 71-1521.

• Decision Date: 30 March 1972
• Docket Number: No. 71-1521.,71-1521.
• Citation: 459 F.2d 352
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. William M. RICKERT, Defendant-Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

459 F.2d 352 (1972)

UNITED STATES of America, Plaintiff-Appellee, v. William M. RICKERT, Defendant-Appellant.

No. 71-1521.

United States Court of Appeals, Fifth Circuit.

March 30, 1972.

Harry M. Hobbs, Tampa, Fla., for defendant-appellant.

John L. Briggs, U. S. Atty., Bernard H. Dempsey, Jr., Claude H. Tison, Asst. U. S. Attys., Tampa, Fla., for plaintiff-appellee.

Before JOHN R. BROWN, Chief Judge, INGRAHAM and RONEY, Circuit Judges.

RONEY, Circuit Judge:

Defendant was convicted on ten counts of embezzling and willfully misapplying funds belonging to a bank of which he was president. 18 U.S.C. § 656.¹

The defendant seeks reversal on three grounds: first, the jury was infected with prejudicial material in a newspaper release made during the trial; second, the evidence did not sustain the charges as contained in the indictment that the defendant converted the sums of money entrusted to the custody and care of the bank to his own use; and third, the court's instructions misled the jury as to the essential elements of the crime as charged in the indictment.

I.

A newspaper story published during the trial quoted the prosecutor as saying that the bank suffered a $64,000 loss. In fact, only $14,780 was involved in the indictment against defendant. The prosecutor should have avoided any chance of an unfair trial from a prejudicial newspaper release by refraining from discussing the case with the press. Nonetheless, the trial judge carefully determined that no juror had been exposed to the harmful portion of the publication and that it did not interfere with a fair trial.

II.

As to the indictment, the evidence and the court's instructions, the defendant argues the same theory, i. e., that none of the sums charged ever left the bank and that, therefore, the defendant could not be guilty of conversion to his own use. The argument is based on the assumption that a violation of 18 U. S.C. § 656 requires that (1) the misapplied sums be bank property; (2) the bank be shown to have suffered an actual loss as a result of the misapplication; (3) the cash actually left the bank; and (4) the funds converted redound directly to the pecuniary benefit of defendant. We find these assumptions to be without merit.

(1) It is not necessary that the misapplied sums be bank property. Section 656 prohibits the willful misapplication of "any of the moneys, funds or credits of such bank or any moneys, funds, assets or securities intrusted to the custody or care of such bank." That this covered defendant's activities is shown from his own description of what he did in the statement made by him when he left the bank, which statement was admitted into evidence.

"The facts concerning the misapplication of funds centers around my attempting to cover up my losses on bad loans. This has occurred first through a charge to the W. E. Ritter estate for money to cover an overdraft on Plant City Body & Iron and others. I later charged the account for funds to cover the loss on J. P. Gould\'s cars, I believe. At one time I also made a charge to cover some repo cars floorplanned by Barney and on which a loss was suffered. I subsequently borrowed $9,000 to make good part of the difference, but had to take some money from the Haines Street Improvement Company. This account is short approximately $14,000. . . .

You will recall that we sold Professional Clothing Care, Incorporated, that I reported it sold to F. Williams. He had agreed to $10,000 but never would settle. He signed a note for me and I filled in an amount to cover the Ponder note. I subsequently charged two payments to his account, but he does not know the amount of the note. . . ."

* * * * * *

When Keith left the bank, he owed us approximately $6,000 on an installment loan. He asked and Burton Walker signed a note for him for the amount Keith has been paying on this note. However, Burton Walker thinks I have replaced his note with one from Keith. If you wish to keep Burton from learning this, the cards should be removed from the tray now before the loan notices are sent."

(2) Section 656 does not require that it be shown what actual loss the bank suffered, if any. The operative words of the statute are "willfully misapplies." Such activity by a bank president would necessarily tend to impair the stability of the bank. In construing Rev.Stat. § 5209, a predecessor of the present section, the Supreme Court said that "the primary object of the statute was to protect the bank from the acts of its own servants." Coffin v. United States, 162 U.S. 664, 669, 16 S.Ct. 943, 946, 40 L.Ed. 1109 (1896). Nor is it necessary for conviction under Section 656 that the bank suffer any actual loss of cash money. See Golden v. United States, 318 F.2d 357 (1st Cir. 1963); Rakes v. United States, 169 F.2d 739 (4th Cir. 1948), cert. den., 335 U.S. 826, 69 S.Ct. 51, 93 L.Ed. 380 (1948). See also United States v. Fortunado, 402 F.2d 79 (2nd Cir. 1968), cert. den., 394 U.S. 933, 89 S.Ct. 1205, 22 L.Ed.2d 463 (1968...