81 N.Y.2d 1008

In cases of larceny by false pretenses against a corporation, the reliance of the corporation’s employees or agents on the defendant’s misrepresentations can be imputed to the corporation, satisfying the reliance element of the crime.

Summary

Defendant, a bank loan officer, was convicted of larceny by false pretenses for obtaining money from the bank through intentional material misrepresentations. The evidence showed that the defendant colluded with a co-conspirator, who made false statements on loan applications with the defendant’s knowledge. The defendant then misrepresented the co-conspirator’s financial status to bank colleagues, inducing them to approve loans beyond his lending authority. The court held that the reliance of the bank’s employees on the defendant’s misrepresentations could be imputed to the bank, thus satisfying the reliance element required for larceny by false pretenses. The conviction was affirmed.

Facts

The defendant, a bank loan officer, was accused of working with a co-conspirator to defraud the bank. The co-conspirator made false representations on loan applications. The defendant misrepresented the co-conspirator’s financial status to other bank employees, leading them to co-approve loans that exceeded the defendant’s individual lending limit. The defendant also approved checks drawn on the co-conspirator’s overdrawn account, inducing colleagues to cash them. The loans eventually defaulted.

Procedural History

The defendant was convicted of larceny by false pretenses in the trial court. The Appellate Division affirmed the conviction. The case was then appealed to the New York Court of Appeals.

Issue(s)

Whether, in a prosecution for larceny by false pretenses against a bank, the reliance of the bank’s employees or agents on the defendant’s misrepresentations can be imputed to the bank to satisfy the reliance element of the crime.

Holding

Yes, because the reliance of its agents may be imputed to the victimized bank.

Court’s Reasoning

The court found that the defendant’s conviction was supported by ample circumstantial evidence of collusion to deceive the bank. The co-conspirator’s false representations on loan applications, coupled with the defendant’s misrepresentations of the co-conspirator’s financial status to other bank employees, established a scheme to defraud the bank. The court emphasized that the bank’s employees relied on the defendant’s misrepresentations in recommending approval of the loans and cashing checks on an account with insufficient funds. The court directly relied on the principle that “the reliance of its agents may be imputed to the victimized bank.” The court cited precedent, including Oliner v. Mid-Town Promoters, Inc. and Seneca Wire & Mfg. Co. v. Leach & Co., to support the imputation of reliance from agents to the principal. The court concluded that the People adequately established the larceny charge.