Evening star., 1931-06-19
SHAPIRO PLANNING
TO RESUME WORK
Medical Building at Nine
teenth and | Is Among
Projects Included.

Washington realty and medical circles
today gave an attentive car to Jacob B.
Shspiro's announcement that his con-
struction company was expected to re-
sumo operations soon.
Shapiro told jury of eight men and
four women in District Supreme Court
late yesterday of his plans, which in
clude the erection of medical building
at Nineteenth and streets The realty
and building operator is on trial on a
charge of mail fraud.
Court stood at recess today until
Tuesday when Shapiro will resume the
stand to conclude testimony in his own
behalf. Yesterday he made a frank
recital OF his business activities here
during the last 10 years. rising from a
penniless youth to a millionaire in seven
years, in an effort to break down evil
| dence adduced from Government wit
nesses that he induced them to buy real
estate encumbered by a so-called hidden
trust.
Company Inactive Since 1928.
The defendants construction COM
pany has been inactive since 1928 be-
cause he said. of a def1ation in the
realty market here which caused him
to lose his fortune. AS to his future
activities, the following are Shapiro's
own words in answer to a question pro-
pounded by Alvin l.. NeWmyer of de-
fenSe counsel:
Eyes. I am building again. In 1929,
| it was not wise to build. but in the last
| four or five months / have interested
some of the biggest business men of the
city as partners. They are putting up
the money and I am doing the build
| ing. and We will split the profit.
/ L am planning medical building
at Nineteenth and I streets, where so
| prominent doctors are going to put up
the money and I am going to sell it
to them on the same cooperative basis
sold the apartments. They are going
| to put up $25000 or 100000 and
| will do the building, and they will pay
me for it,
The cooperative apartments Shapiro
referred to are the Hampshire Gardens,
near New Hampshire avenue and
Emerson street. These apartments were
subjected to court litigations after being
erected. At present there are three
| medical buildings in the vicinity of
Shapiro's project.
will Be Cross Examined.
Shapiro will be crossed-examined by
! w. Fihelly. The prosecutor today was
! silent as to his plans.
Before court recessed yesterday
| Shapiro told of his rise and fall in the
real estate business here, starting fresh
| from college in 1919 at the age of 19.
| His firm grew from a one-clerk affair
to an organization of approximately 600
! employees. He built more than 1000
houses, apartments and commercial
buildings in seven years and accumulat-
ed fortune in excess of $2,000000.
| In getting his start he borrowed money
to buy land and borrowed money to pay
off the original transaction, giving a
blanket mortgage on a group of houses
and paying this off when the houses
were sold. When his fortune began to
slip from him in 1927 he made an effort
to recuperate by unloading his realty
securities.
81 had to sacrifice a great many prop
| critics." he testified because I had to
sell securities at discount of 80 to 40
per cent. For instance, If sold $780,
600 worth Of securities, could only get
from $50,000 to 100000 in cash. If a
piece of ground cost me 100000
would sell it for $4,000 to 100000 in
order to get cash to operate"
Down to $SOO,OOO in 1929.
In October, 1929, the defendant said
he was down to 100000 and with a
number of blanket mortgages out, in
cluding those on the "a homes involved
IN this case. Then the stock market
crashed, making it impossible, he said,
to borrow money from the banks. He
said conditions were so bad at that time
that to borrow $4,000, he would have
to put up $l,000,000 in securities.
| Then the mortgage called on the
| property owners to pay of the ground
| trust, Of which they had no knowledge
This resultedsin Senate District Com
mittee investigation and his indict-
nent by grand jury
Was there any time, until after this
| crash occurred, when any of these
| financial houses you were dealing with
/, ever notified or made any demands upon
the purchasers of these homes to pay
those ground trusts?" Mr.. Newmyer
asked.
No" the defendant replied, because
! they knew 1t was my obligation and
/ they always looked to me for it."
| The trial is not expected to be con-
/ cluded before next Thursday, the
| prosecution indicating today that IL
would call . number of witnesses IN
TebuttaL