Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-07-18
SHAPIRO ARRAlGNED
IN MORTGAGE CASE;
GIVES $4,000 BOND
CONTINUED From First Page.1

Frisbies complaint was the first actual
ly made to this Office"
The property at 1718 Irving street
is one of a number of houses in that
block which figured in testimony given
before the Blaine subcommittee yes
terday.
Rover said that Frisbie told him he
had purchased the house two years
ago. He had assumed $4,000 first
mortgage on the property and was led
to believe, the district attorney stated,
that the only other mortgage for which
he was obligated was second trust
of $4,000.
"Frisbie paid off the $1,000 second
trust and learned later about the exist
ence Of a hidden trust of approximately
$4,000" Rover said.
The district attorney pointed out
that the purchaser had never received
certificate of title at time of the
transaction with Shapiro.
Shapiro, he stated, had made efforts
to straighten out the matter of the
second lien, which had been held by
q man now dead, but had been I'M
able to get it all paid of.
Hearings Suspended.
In the midst of investigating the real
estate transactions of the Shapiro Co.,
as the first phase Of an inquiry into
mortgage operations in washington, the
Blaine subcommittee yesterday suspend
ed it's hearings pending the outcome OF
the naval treaty situation in the Senate.
MI witnesses under subpoena, how
ever, we're ordered to hold themselves
in readiness to answer q call OF the
committee at q moments notice. When
this may be appears dubious. Senator
Blaine explained the committee could
not meet today as the presence of men,
bers was required in the Senate.
"It is possibl we may not be able to
meet again this Summer and the hear
ings in that event would have to be
suspended until Fall" he said. On the
other hand, he added, there was a
chance that another meeting could be
called within q day or so.
Wide Inquiry Possible.
1t was clearly evident from the results
of the first day that the work of the
phases of the real estate situation and
mortgage business. Inquiry into the
operations of the r. H. Smith Co., 1t is
understood, will follow closely on the
heels of the Shapiro affairs.
When the committee suspended late
yesterday, j. w. Jacobs, vice president
of the B. F. Saul Co., was on the stand.
He had been questioned at length
by members Of the committee regarding
the firms connections with operations
of the Shapiro Co. Jacobs had brought
documents bearing on cases in which
the committee was directly interested.
He had indicated his Willingness to re-
veal all the information In his posses
sion by agreeing to waive immunity
from prosecution in the courts.
According to Oscar H. Brinkmar1, Spe-
cial attorney for the committee, wit
nesses remaining under subpoena in
clude John Saul, secretary of the B. F.
Saul Co.; Arthur j. Linn, controller Of
the Federal American Bank, and L. Z.
Breuninger, president of the Real Estate
Mortgage & Guaranty Co.
Hidden Trusts Charged.
The transactions of the Shapiro Co.,
according to the testimony of witnesses
yesterday, involved the sale of houses
incumbered by q hidden trust" the ex-
iStence Of which the witnesses said was
unknown at the time of settlement. =.
The B. F. Saul Co., III most of the
cases, had held first mortgages on the
properties. Testimony given by its vice
president indicated to the committee
that the Saul 90. and its subsidiaries
had been the victims of deception in the
transactions.
The Shapiro Co. had been advanced
hundreds Of thousands Of dollars" by
the Saul Co., Jacobs testified, over a
period of 10 years in the building of sub
divisions. The Saul Co., he said, had
taken q blanket trust" on the prop
critics, which really became second
lien and superseded the ordinary sec-
ond trust deed which the purchasers
of the houses later signed. Unknown
to the Saul Co., Jacobs testified, the
shapiro Co. had sold houses without
paying of this second builders lien, the
existence of which was revealed only
when the purchaser, months later went