Opinion ID: 218749
Heading Depth: 3
Heading Rank: 1

Heading: Hill's Convictions for Bank Fraud and False Credit Applications

Text: To prove bank fraud under 18 U.S.C. § 1344, the government must show that: (1) a scheme existed to obtain money, funds, or credit in the custody or control of a federally insured financial institution; (2) the defendant participated in the scheme by means of material false pretenses, representations, or promises; and (3) the defendant acted knowingly. United States v. Williams, 390 F.3d 1319, 1324 (11th Cir. 2004). To prove that a defendant filed a false credit application under 18 U.S.C. § 1014 the government must show that: (1) the defendant knowingly made a false statement or report; and (2) he did so for the purpose of influencing the conduct of a federally-insured bank with respect to an application, advance, commitment, or loan. United States v. Thorn, 17 F.3d 325, 327 (11th Cir.1994). The evidence showed that in order to obtain two lines of credit from Charter, Hill and his associates submitted applications in the name of two Hill-owned entitites, Atlanta Condo and Storage, Inc., and Atlanta Millenium Investments, L.L.C. Hill represented to Charter that Christopher Graham, his employee who performed maintenance and furniture moving services, owned a 25 percent stake in Atlanta Condo (valued at $180,000) and also $20,000 in furnishings. Hill's own financial statement indicated that he was receiving an income of $20,000 per week from Atlanta Condo and that his ownership interest was worth $570,000. In reality, Graham's name was listed on the Atlanta Condo application in order to obscure Hill's involvement from disgruntled residents. And Atlanta Condo was not worth $750,000, as Hill had represented. The company had no accounts receivable, it had conducted no business, and according to Hill's tax returns, it was valued at only $90,000. The evidence also showed that Hill presented Charter with a shareholder agreement between himself and Graham that was dated October 6, 2001, but Graham testified that he did not know Hill in 2001 and he did not move to the address listed as his residence on the application until March of 2002. Finally, Hill represented to Charter that the line of credit would be used for working capital. Instead, Hill used the money to buy things for himself and for his daughter and to pay for expenses associated with his personal residence. There was also sufficient evidence to sustain Hill's convictions for bank fraud and false credit applications regarding the Atlanta Millenium line of credit (Counts 4 and 6). The evidence showed that Hill again represented to Charter that the funds would be used for working capital, but he and Vargas, his co-conspirator and inside man at Charter, knew at the time that the loan would be used to fight a temporary restraining order that resulted from litigation over Hill's sale of some condominiums (Counts 19-187). Also like the Atlanta Condo transaction, Hill offered a security interest in Atlanta Millenium's assets even though the company had conducted no business and had no accounts receivable. Even if Charter would have had an interest in any future accounts receivable, as Hill now argues, the evidence still showed that the application was fraudulent because of Hill's representations to Charter, which he knew to be false. The evidence showed that Hill's fraud on Charter continued even after Vargas was asked to resign once his involvement in several suspicious transactions came to light. When Charter discovered that Hill was connected to the Atlanta Condo and Atlanta Millenium transactions, Hill met with Hungerford, a Charter Bank Vice President, to discuss the prospects of repayment. In that meeting, Hill reaffirmed that the Atlanta Condo line of credit was secured by the accounts receivable, which Hill knew did not exist, and he further represented that the Atlanta Millenium line of credit was secured by a $400,000 note from Alcindor Williams, which he expected to be paid in two weeks. Hill concealed the fact that the Alcindor-Williams Group had already filed for bankruptcy and that there was no real hope that the note would be paid any time soon, if ever. The evidence showed that Hill later sent a fax to Hungerford indicating that the lines of credit were also secured by a primary mortgage on Lot 33 of the Cascade subdivision as well as secondary liens on 28 homesites. He concealed the fact that Lot 33 had already been conveyed to the Alcindor-Williams Group, which had contracted to build a house on the land (an obligation that was never performed). Hill also failed to disclose that a secondary lien on any of the 28 homesites was worthless because Centrum was foreclosing on its primary lien that was valued at $1.2 million. The government produced enough evidence at trial from which a reasonable factfinder could conclude beyond a reasonable doubt that many material misrepresentations Hill made to Charter Bank were fraudulent. His insufficiency of the evidence contentions are all meritless.