United States v. Paguio

114 F.3d 928 (9th Cir. 1997)

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Nature of the Case

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Facts

Paguio (D) and Acosta (D), husband and wife, were convicted of false statements to a bank to influence action on a loan. Paguio's (D) father, Gil Paguio, Sr., initiated the loan process. The father approached the loan officer about a $204,000 loan so that Ds could buy property next to his house. The loan officer gave the father the application, and the father returned the handwritten loan application with what purported to be Ds' signatures. The application was fraudulent. It showed Ds made $3,200 a month in self-employment income from the father's insurance company. That was not true. As 'verification,' the father showed the bank fictitious 1988 and 1989 tax returns and 1099 forms for Ds. None of these forms had actually been filed with the IRS. Acosta had been turned down for an $18,000 car loan. Paguio (D) had asked for forbearance on his $10,000-dollar student loan because of inability to make the payments. Both Ds signed the final loan application. Paguio (D) was under investigation by the FBI, because of a counterfeit computer tape, which caused a $70 million funds transfer to a Swiss bank. P discovered the $204,000 loan and other evidence that Ds were not as financially secure as the loan application suggested. Ds were indicted. Their defense was in substance that the house loan was the father's deal, and the son and fiancée lacked mens rea. When the case was retried, the father was a fugitive. During discovery in the first trial, the father admitted that he was at fault and his son had nothing to do with it. The court admitted the inculpatory part of the statement but excluded the party where the father said his son had nothing to do with it. Ds were convicted and appealed.