United States v. Dilliard

The defendants appeal from judgments of conviction under an indictment charging them among other counts with a conspiracy to use the mails to defraud: they complain (1) that the evidence was not sufficient to sustain the verdict; (2) that they were unfairly denied a bill of particulars in advance of the trial; (3) that the judge erred in various ways in his summing up to the jury, and in the admission of evidence; (4) that their cross-examination was improperly curtailed; (5) that the court should have granted a mistrial, and (6) that the prosecutions speeches to the jury were unfair. The first ground requires a statement of the evidence. Dilliard was president of the State Title & Mortgage Co. and its chief executive; Koven was a vice-president, converned chiefly with the appraisal of real property; Donegan was also a vice-president, in charge of advertisements and publicity, and later of the "default department". A fourth defendant, one Skiffington, was acquitted. The company was organized in the year 1927 for the purpose of selling guaranteed mortgages: sometimes it sold these outright; sometimes it sold "participation certificates" in a single mortgage, which it held in trust for certificate holders; sometimes it set up as security a pool of mortgages, which it either assigned to a trustee, or itself held in trust. On June 1, 1929, it was merged with two other companies doing a similar business, and took over their assets and obligations; its capital was then $8,300,000. It continued in business until March 3d, 1933, when it suspended operation, and it was taken over by the state insurance department in the summer of that year. The chief irregularities relied upon by the prosecution were in the management of the mortgage pools, the appraisals of the real property, and the accumulation of back taxes and interest. With these were coupled false entries in two financial statements issued at the end of 1931 and 1932. The indictment contained, besides the conspiracy count, a number of others, each laying against all the defendants severally, the posing of a letter in pursuance of a scheme to defraud. § 338, Title 18, U.S. Code, 18 U.S.C.A.§ § 338.