People v. Barletta, 65 N.Y.2d 148 (1985)
To prove criminal usury in the first degree under Penal Law § 190.42, the prosecution must demonstrate both a usurious loan and that the defendant’s actions were part of a “scheme or business of making or collecting usurious loans,” which can be established through evidence of multiple, interrelated usurious transactions.
Summary
Defendant was convicted of criminal usury in the first degree. The New York Court of Appeals affirmed, holding that the evidence was sufficient to prove that the defendant engaged in a “scheme or business of making or collecting usurious loans.” The court found that the initial loan and subsequent renegotiation constituted multiple, interrelated usurious loans, demonstrating a scheme or business. This case clarifies the evidentiary requirements for establishing a “scheme or business” of usurious lending under New York law and highlights that a renegotiated loan can be considered a separate, interrelated transaction contributing to the overall scheme.
Facts
Frank Xidakis borrowed $2,000 from the defendant’s agent, Demos Pierratos, at a usurious interest rate of $100 per week. After paying approximately $5,000 in interest, Xidakis stopped payments. The defendant then threatened Xidakis for failing to pay. Xidakis cooperated with the police, who recorded phone calls between Xidakis and Pierratos. The defendant renegotiated the loan with Xidakis, agreeing to accept $3,000 payable at $100 per week. Xidakis made regular payments but later settled the remaining debt with a final payment of $1,000.
Procedural History
The defendant was convicted of criminal usury in the first degree after a jury trial. The Appellate Division affirmed the conviction without opinion. The defendant appealed to the New York Court of Appeals, arguing insufficient evidence to prove a “scheme or business of making or collecting usurious loans.”
Issue(s)
Whether the evidence presented at trial was sufficient to establish that the defendant’s conduct was part of a “scheme or business of making or collecting usurious loans,” as required for a conviction of criminal usury in the first degree under Penal Law § 190.42.
Holding
Yes, because the initial usurious loan and its subsequent renegotiation constituted multiple, interrelated usurious loans, providing sufficient evidence for the jury to conclude that the defendant was engaged in a “scheme or business” of usurious lending.
Court’s Reasoning
The court emphasized that Penal Law § 190.42 requires proof of both a usurious loan and that the defendant’s actions were part of a “scheme or business” of making or collecting usurious loans. The court distinguished this from criminal usury in the second degree, which only requires proof of the usurious loan itself. Referencing People v. Villani, 59 N.Y.2d 781 and People v. Lombardo, 61 N.Y.2d 97, the court clarified that a “scheme or business” requires a “series of transactions, multiple as to loans if not borrowers, which are usurious and * * * can factually be found to be interrelated and to constitute parts of an integrated single operation.” The court found that the renegotiation of the initial loan, which altered both the interest rate and the principal amount, constituted a separate, interrelated usurious loan. Furthermore, the defendant’s direct participation in collection efforts and the renegotiation process supported the jury’s finding that he was engaged in a “scheme or business.” The court noted that the defendant directly participated in collection efforts on the first loan, and negotiated and collected payment on the second loan. The court stated that this provided “sufficient support in the record for the jury to have found defendant guilty of criminal usury in the first degree.”