Jr. came into the 149th Street branch of Royal and approached Rudolph Santoro, one of Royal's employees, for the purpose of selling a $10,000 United States Treasury Note. Santoro was then acting head of the loan department at that branch. Mazzochi identified himself as an officer of the Mutual Credit Union (Mutual). Mutual had been a customer of the bank since around 1950. Its members and officers were customers of the bank and some of its officers had previously in 1965 identified Mazzochi as the new president of Mutual. Mutual was also a frequent borrower at the bank. Mazzochi thus came to the bank upon good recommendation. He was well dressed and presented a neat and gentlemanly appearance.
Santoro's responsibilities at this time were clerical in nature. He didnot make decisions or judgments and was not an officer. When Mazzochi told him of the nature of the transaction it was the first such transaction Santoro had handled as acting head of the loan department. He gave Mazzochi a receipt for the note dated August 4, 1966, and Mazzochi gave him an authorization to sell the note which stated:
"I hereby authorize Royal National Bank to sell for me one (1) $10,000 U.S. Treasury Note # 112255Due November 15, 1970 SAC 11/15/66."
Santoro retained the United States Treasury Note and sent Mr. Mazzochi to one of the officers for approval of the sale.
Mr. Mazzochi saw Mr. Robert Kayner a credit officer of Royal with full authority to approve a sale of Treasury Notes. He had met Mazzochi about a