Evening star., 1931-05-12
EmbezzIement and Conceal
ing of Writings Charged
by Grand Jury.
NAMING OF LATTER
PROVES UNEXPECTED
Decision of Panel Viewed as First
in Series of Fraud Returns
in Bankruptcy Probe.

The District grand jury today in
dicted Edmund D. Rheem and j. New
ton Brewer on charges growing out of
the bankruptcy of Swartzell, Rheem 6S
Hensey Co.
The indictment is in two counts, one
charging them with taking away and
concealing writings, and the other with
embezzlement. Rheem was first vice
president and executive head of the
concern, while Brewer was second vice
president.
The case was presented to the grand
jury by Assistant Attorney General
Nugent Dodos and special Assistant
Attorney General Neil Burkinshaw.
The offenses charged in the indict-
ment were allegedly committed on jan
uary 13, last. At that time, 1t Is SAID,
the Washington Loan and Trust Co,
trustee for the estate OF Clarence b.
Rheem, father of the indicted official,
learned that approximately $l62,OOO IN
notes. comprising part OF the estate
we're secured by deeds Of trust which
had been released.
The bank, it is charged, then notlneo
Rheem that he must either pay the
face value of the notes or replace them
with properly secured notes in the same
amount. Rheem, according to the in
dictment. then instructed Brewer 10
bring him from the company's vaults
$l62 900 in notes on the Shoreham
Hotel. which had been left with the
mortgage firm for safekeeping by pur-
chasers. These notes, 1t Is charged
were then turned over to the Washing
ton Loan and Trust Co. to replace the
released notes in his fathers estate.
1t is charged this was done with IN
tent to defraud and 1nJure tne S"aF'-
zell, Rheem and Hensey Co.
Other Indictments Expected.
About 10 days ago, Rheem. as bene-
ficiary under his fathers will, and nus
mother, Mrs. Eulalie Rheem Rowe,
executrix, signed an authorization
whereby the bank was authorized 10
return the notes. to the trustees OF
Swartzell. Rheem & Hensey co. -,
This step, it was pointed out, Will
make the $4,000 available for pay
ment to creditors Of the bankrupt firm
The indictment was returned by the
Jury to Justice Peyton Gordon shortly
after noon today. 1t was understood
this Is one of series OF indictments
the grand jury is expected to return
In the case.
NOtehOIders Listed.
The Indictment charges the notes
embezzled were the property Of:
Mary M. Baily, Evelyn H. Barnette,
Ella r. Bates, Caroline M. Blackburn,
Florence r. Boyd, Alice v. Bunker,
Mary A. Chute, Elizabeth Clapp, Emma
o. Clark, j. A. Claxton, Mary Colgan,
Harry r, Conover, Sue e. Crump. Flor
ence Cutcheon, A. C. Daniel, Elizabeth
s. Davis, Irma M Davis, Virginia /.
Davis, F. A. Denison, Marie D. Dill,
H. M Dodge, H. C. Donohue, Robert
L. Ettinger Richard T. Evans, Carrie
8. Fall, Alice F1ndley. Lena Fischer.
Alice M. Fogg, James H. Fox, Elizabeth
Rice, Annie NJ Smith and the estate
of L. Pearl Ward.
!. Brewer Charges Unexpected.
Rheem was arrested several months
ago in connection with his alleged
transactions. He Is now at liberty under
bond. Brewers alleged connection with
the deal, however, is brought out for
the first time in the indictment.
Inasmuch as Rheem has testified at
bankruptcy hearings that he was the
sole head of the firm and that the other
officers acted under his direction, Brew
ers indictment was unexpected in many
quarters.