United States v. Carl F. Warnick, 815 F.2d 1341, 10th Cir. (1987)

815 F.
2d 1341
UNITED STATES of America, Plaintiff-Appellee,

v.
Carl F. WARNICK, Defendant-Appellant.
No. 86-1802.
United States Court of Appeals,

Tenth Circuit.
April 6, 1987.
1
Randall Gaither, Salt Lake City, Utah, for defendant-appellant.
Richard N. Lambert, Asst. U.S. Atty., Salt Lake City, Utah, for plaintiffappellee.
Before HOLLOWAY and SEYMOUR, Circuit Judges, and SAFFELS, District

Judge.*
SAFFELS, District Judge.
Defendant Carl F. Warnick entered a conditional guilty plea to a charge of

knowingly and willfully making a false statement and reporting and
overvaluing property and security for the purpose of influencing a federallyinsured bank in violation of Title 18 U.S.C. Sec. 1014 (Supp.1982). His plea
reserved the right to appeal the denial of a motion to dismiss based on statute of
limitations grounds pursuant to Title 18 U.S.C. Sec. 3282 (1979).
On appeal, defendant asserts that the district court erred in denying defendant's
motion to dismiss the indictment, which charged a criminal offense for making
a false statement to influence a bank to obtain an extension of a loan. Defendant
argues that any criminal offense for the false statements, made at the time of
the original loan, was barred by the statute of limitations. Essentially, defendant
asserts that the making of the original loan and the subsequent extension of that
loan constituted one transaction.
We agree with the district court that the transaction on October 17, 1980,
constituted a separate loan transaction and a separate chargeable offense. The
original loan was executed on August 19, 1980, and became due and payable
on October 17, 1980. The Agreement to Amend by Modification or Extension
of the original loan was executed on October 17, 1980. The extension created a
new obligation at a higher rate of interest. We find significant the fact that as
part of the documentation for the extension, the bank relied on a previously
executed financial statement and equipment list submitted at the time of the
original loan transaction. The earlier executed documents were attached to the
extension application.
8
The language of the Agreement to Amend by Modification or Extension

supports the district court's finding that the transaction for extension on October
17, 1980, constituted a separate loan transaction. The disclosure statement to
the Agreement to Amend by Modification or Extension clearly provides at
paragraph 11: "This loan is secured by accounts and amounts owed by Bank in
any capacity to Borrower and is secured by those security interests created or
existing and securing the obligation referred to in Item 1 above, which security
agreements are hereby republished...." Id. (emphasis added). We find that the
act of republishing the earlier financial statement and equipment list did
constitute a separate and distinct violation of 18 U.S.C. Sec. 1013. We note that
the defendant does not assert that he did not read nor know what he was signing
at the time of the extension. The record further indicates that the prior security
agreement and the list of equipment was physically affixed to the October 17,
1980, Agreement to Amend by Modification or Extension.
Title 18 U.S.C. Sec. 1014 (Supp.1982) specifically provides that it is a crime to

make:
10 false statement, or report, or willfully overvalue any land, property or security,

any
... upon any application, advance, discount, purchase, purchase agreement,
repurchase agreement, commitment or loan, or any change or extension of any of the
same, by renewal, deferment of action or otherwise....
11
Id. The statute makes clear that the false statement need not be an "application"
in and of itself. United States v. Zwego, 657 F.2d 248, 250 (10th Cir.1981),
cert. denied, 455 U.S. 919, 102 S.Ct. 1275, 71 L.Ed.2d 460 (1982).
12
We find that the Fifth Circuit's decision in United States v. Brown, 674 F.2d
436 (5th Cir.1982), can be distinguished from the facts at hand. In Brown, the
court found that in the absence of a record revealing any direct reference to an
earlier executed financial statement, or even an indirect or implicit reference to
it, one may not be held liable for making a false statement in the extension of
the original loan. In this case, unlike Brown, the defendant sought an extension
of an original loan and did so by "republishing" the false security agreement

and false list of equipment.
13
We agree with the district court that the defendant's act of signing the
Agreement to Amend by Modification or Extension, in which he republished
his earlier false security agreement and list of equipment, constituted a new and
separate offense under 18 U.S.C. Sec. 1014. Accordingly, we agree that the
district court properly found that the statute of limitations on the extension
transaction did not begin to run until October 17, 1980. The indictment which
was returned on October 16, 1985, was therefore timely.
14
AFFIRMED.
The Honorable Dale E. Saffels, United States District Judge for the District of
Kansas, sitting by designation

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815 F.

UNITED STATES of America, Plaintiff-Appellee,

United States Court of Appeals,

Randall Gaither, Salt Lake City, Utah, for defendant-appellant.

Before HOLLOWAY and SEYMOUR, Circuit Judges, and SAFFELS, District

SAFFELS, District Judge.

Defendant Carl F. Warnick entered a conditional guilty plea to a charge of

The language of the Agreement to Amend by Modification or Extension

Title 18 U.S.C. Sec. 1014 (Supp.1982) specifically provides that it is a crime to

10 false statement, or report, or willfully overvalue any land, property or security,

of an original loan and did so by "republishing" the false security agreement

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