United States v. Joseph Michael Rice, Jr.

Joseph Michael Rice, Jr., was convicted on three counts of receiving money or profits through transactions of Allstate Savings and Loan Association (Allstate) with the intent to defraud Allstate. 18 U.S.C. § 1006 (Section 1006). He appeals and we affirm.

Rice worked as a consultant for Allstate from May, 1976 until June, 1978. His written contract with Allstate provided that he would work exclusively for Allstate to originate first mortgage loans on one to four units of existing residential property. Allstate assigned Rice to a specific area; commissions based on the dollar volume of loans he originated were to be his sole compensation. Allstate reserved the right to decide whether to make a loan.

Rice contends that in 1977, he began “working for borrowers to make complex deals lendable” and that he charged the borrowers a fee of 1V2% of the loan principal for his extra work.

In August, 1977, Neil Hagerty approached Rice to get Allstate to finance the sale of four condominiums. Rice advised Hagerty to sell each condominium to an individual who would finance the purchase through Allstate and demanded an up-front payment of U/2% of the requested loan principal to “Alltrust.” Rice…