United States v. Navarro-Ordas

770 F.2d 959
CourtCourt of Appeals for the Eleventh Circuit
DecidedSeptember 10, 1985
DocketNos. 83-5233, 84-5281
StatusPublished
Cited by38 cases

This text of 770 F.2d 959 (United States v. Navarro-Ordas) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eleventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States v. Navarro-Ordas, 770 F.2d 959 (11th Cir. 1985).

Opinion

TJOFLAT, Circuit Judge:

During a six month period in 1977 and 1978, the appellants, Andres Felipe Rodriguez-Ortega, Haydee Alvarez DeRodriguez, Francisco Humberto Navarro-Ordas, Jose Jane, and others 1 obtained over $3 million in fraudulent loans from three Miami, Florida banks. When the fraud was discovered, they were indicted2 by a federal grand jury and convicted of mail3 and wire4 fraud and of conspiring to violate the [962]*962mail and wire fraud statutes by utilizing the U.S. Postal Service and interstate wire communications to obtain the fraudulent bank loans.5 Rodriguez-Ortega and Jane were convicted of other offenses as well. Jane was found guilty of making a false statement in applying for one of the bank loans;6 Rodriguez-Ortega was found guilty of racketeering7 and ordered to forfeit8 to the United States the sum of $3,203,045.42, the proceeds of his illegal activity.9

These consolidated appeals are from appellants’ convictions and from the order of forfeiture, respectively. Appellants question the sufficiency of the evidence to support their convictions and several of the trial court’s rulings. Concluding that the Government’s proof established each of the crimes charged and that appellants received a fair trial, we affirm their convictions. With respect to the order of forfeiture, the Government concedes a possible error in the court’s calculation of the amount of Rodriguez-Ortega’s liability; accordingly, we remand the order so the error, if any, can be corrected.

I.

A.

The fraudulent scheme in this case dates back to 1975, when appellants Rodriguez-Ortega (Andres Rodriguez) and DeRodriguez (Haydee Rodriguez), his wife, traveled to the Netherlands Antilles and organized three banks: First National Mortgage Bank, North American Bank and Trust Company, and Caribbean Mortgage Bank. None of the three ever did any banking business; they were mere corporate “shells.” Nonetheless, they played a significant role in the appellants’ subsequent crime spree.

With these corporate charters in hand, Andres Rodriguez set out to purchase an [963]*963existing bank in south Florida. He contacted Gonzolo Ruiz, a bank executive he knew in Miami, and broached the idea of going into the banking business together; Rodriguez would own the bank and Ruiz would run it. Ruiz liked the idea, and he and Rodriguez searched the area for prospects. The Northside Bank of Miami was for sale and negotiations ensued. The price proposed by the bank’s shareholders, $3.1 million, was beyond the Rodriguezes’ resources, however, so a syndicate of local investors was formed to provide some equity capital.

In March 1977, the syndicate, led by Andres Rodriguez, signed a contract to buy the Northside Bank for $3.1 million. The contract called for a $450,000 cash down payment, which was made, and $2.65 million in cash at the closing, which would take place the following February. The Bank of Miami tentatively agreed to finance $1.3 million of this sum on three conditions: (1) after the acquisition Ruiz would become the Northside Bank’s chief executive officer; (2) each member of the syndicate would guarantee the $1.3 million loan and pledge his bank stock as collateral; and (3) Rodriguez would pledge as additional collateral his interest in some Puerto Rican real estate which he falsely represented to the Bank of Miami was worth $1 million.10 The syndicate, and Ruiz, agreed to these conditions, and, in June, the Bank of Miami issued a formal commitment to make the loan.

While they were negotiating this loan commitment with the Bank of Miami, Andres Rodriguez and Ruiz learned that the bank’s parent corporation, Bank of Miami Holding Company, wished to sell one of its small off-shore banks, Popular Bank & Trust Co., Ltd., a Cayman Island company.11 Popular Bank & Trust had been formed to accommodate the Bank of Miami’s foreign customers who desired the security of a large American bank but did not want to place their money in an institution domiciled in the United States. Popular Bank & Trust had deposits of approximately $6 million.

Appellant Navarro-Ordas (Navarro), an officer of the Bank of Miami, handled Popular’s day-to-day operations from an office located at the Bank of Miami. Navarro received deposits from foreign customers, placing them in Popular’s account at the Bank of Miami, and issued in exchange Popular Bank & Trust certificates of deposits (CD’s). He had no authority to lend money, except to depositors who provided Popular CD’s as collateral. Any other transaction had to be expressly authorized by the president of the Bank of Miami.

Andres Rodriguez decided to buy Popular Bank & Trust to complement the North-side Bank. Rodriguez’ plan was to own ninety-five percent of the bank’s stock and to give Ruiz the remaining five percent for his efforts in consummating the transaction. On November 15, 1977, they entered into a contract to purchase 100% of Popular’s issued and outstanding stock for $150,000, $100,000 to be paid in cash and $50,000 to be paid in the form of a 180-day promissory note executed by the purchasers and secured by a certificate of deposit acceptable to the seller. The closing, as we recite infra, took place on February 15, 1978, six days before the closing of the Northside Bank acquisition.

On October 6, 1977, forty days before he executed the contract to buy Popular Bank & Trust, Rodriguez began borrowing substantial sums from that bank. Navarro handled each transaction. The loans were made either to corporate shells Rodriguez had set up or to going business enterprises [964]*964he controlled. The first loan, for $30,000, was made to Capital National Investment Corporation, a Panamanian company. Rodriguez secured the loan by pledging a $30,-000 CD issued by the Fidelity National Bank of Miami. The second loan, dated November 4, 1977, for $200,000, went to Security International Insurance Corporation. It was also secured by a Fidelity National Bank CD. Navarro had no authority to make these loans, even though they were fully secured by genuine CD’s, because neither corporate borrower had funds on deposit at Popular Bank & Trust and the loans were not secured by Popular CD’s. Nor did Navarro have any authority to make the loans that followed. They, too, were made to non-depositors; moreover, they were “secured” by worthless collateral.

On November 10, Navarro loaned North American Warranty Investment Corporation, a Rodriguez company, $80,000 secured by a CD of one of the Netherland Antilles shells Rodriguez had organized in 1975, North American Bank and Trust Company. Shortly after this loan was made, Carlos Penin, a Rodriguez associate, entered the picture.

Penin was no stranger to fraudulent dealings. In December 1976, he had persuaded Raquel Morales, an acquaintance of his who lived in Venezuela, to purchase $350,000 worth of CD’s from the Fidelity National Bank in Miami and to authorize him to reinvest the interest they earned in additional Fidelity National CD’s. In April 1977, Penin borrowed $250,000 from Fidelity National Bank and pledged Morales’ CD’s as collateral. Morales visited Miami unexpectedly on December 19, 1977 and attempted to redeem her CD’s.

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Bluebook (online)
770 F.2d 959, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-v-navarro-ordas-ca11-1985.