United States v. Morlang

531 F.2d 183 (4th Cir. 1975)

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Nature of the Case

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Facts

The FHA began a drive to encourage the construction of low to moderate-income rent-supplement housing projects throughout the United States. Nonprofit organizations sponsoring the construction of such projects could obtain no-down-payment mortgages that would be 90% insured by the FHA. Haught, the Director for West Virginia's FHA program, invited lenders, real estate brokers, community officials, and other interested individuals to attend a meeting describing the program. Fred Wilmoth, an agent for the Prudential Life Insurance Company, attended, and following the meeting, he spoke with Haught. Wilmoth asked him to travel to Parkersburg, to meet with D, who was an area banker and builder, in an effort to interest D in participating as a contractor. Wilmoth and Haught visited D's office to discuss the program. The three discussed potential areas of profit, including illegally contrived architectural fees, and concluded that there was 'plenty in it for all.' They also allegedly agreed that former West Virginia Governor W. W. Barron would have to be taken care of because of his previous assistance and political contacts. Both Wilmoth and D flatly deny that there was ever any discussion in D's presence other than as to the general nature of the federal program. Seven projects were launched by D. When approval of the development became bogged down in the FHA office in Philadelphia, Haught allegedly solicited a $2000 bribe 'to walk it through Philadelphia and again the Washington office.' This bribe was purportedly paid by Wilmoth, Barron, Ballard, and D, although Wilmoth testified that D was in no way involved. Seven projects were launched by D. When approval of the development became bogged down in the FHA office in Philadelphia, Haught allegedly solicited a $2000 bribe 'to walk it through Philadelphia and again the Washington office.' This bribe was purportedly paid by Wilmoth, Barron, Ballard, and D, although Wilmoth testified that D was in no way involved. Haught testified that three or four months prior to the $2000 bribe being paid, D personally gave him $800 while in the presence of Wilmoth. Both Wilmoth and D deny having any knowledge of the $800 payment being made. Wilmoth was called by P despite the fact that it was aware that his testimony would tend to exonerate D. The purpose was to elicit from him a denial that he had ever had any conversation with a fellow prisoner in which he implicated D. P obtained the denial. P then called Crist, the man to whom the out-of-court statement was allegedly made. Crist was an inmate and had spent more than half his adult life in prison for a series of convictions extending back to 1941, which included grand larceny, auto theft, breaking and entering, and the Dyer Act. The court permitted the testimony of Crist to be introduced only for the purpose of attacking the credibility of Wilmoth. D was convicted of a conspiracy to bribe but not for the $2000 nor the $800. D appealed.