Evening star., 1935-06-11
Ex-Banker Must Promise to
Leave City to Win Ten
Months Off Term.
BOYER ALSO RECEIVES
FREEDOM FROM BOARD
Former Cashier Has Served Two
Thirds of Three-Year Term
for Embezzlement.
BY JOHN II. CLINE.

from washington, WneTe he sky
rocketed to fame as the youthful ex-
ecutive head of Swartzell, Rheem &
Hensey Co. during the boom years Of
the late 20S.
Threats against Rheem by former
customers of his firm are believed to
have influenced the Parole Board in
imposing this condition, but it could
not be aScertained whether the priS-
oner will accept it. His mother refused
to discuss the matter and his attor-
neys said they didn't know.
It was pointed out the parole cuts
of 10 months of the seven-year SEN
tence imposed after he pleaded guilty
to a technical charge of concealing
writings, and some of his former asso-
ciates expressed the belief Rheem
might prefer to serve the full term
rather than accept the condition
abridging his freedom of action in the
future.
Boyer Also Granted Parole.
The board also granted parole to
Charles D. Boyer. former cashier of
the Federal-Ameriean Bank, who has
served two years of three-year term
ton.
Entering the local bond and mort
gage field Immediately after his gradu-
alton from Princeton. Rheem quickly
demonstrated talents that placed him
at the head of his firm, which had
long enjoyed an enviable reputation
as a conservative mortgage banking
house. Ambitious to dominate his
particular financial field. Rheem un-
dertook the financing of numerous
large properties here. using the mil
lions of dollars placed with his firm
for investment.
Virtually all of the SwartZell. Rheem
g. Hensey trusts contained clause
permitting the release of the instru-
ment as a lien on the property on
payment at the Office of the company.
Acting under this authority, Rheem
in many instances used money COM
ing into his firm in this manner for
reinvestment instead of paying off
the holders of the notes secured un-
der the original trust.
Rheem Defended Policy.
He was bitterly criticized when this
practice was discovered after the fail
ure OF his firm, but he contended it
had been the practice of his bank
ing house long before he became
affiliated with it,
Rheem took the position the Gus
toners deposited the money with the
company for investment and imposed
no restrictions against its reinvest-
ment in such manner as the company
officials saw fit. He denied the fall
ure of his firm was due to any i'm
proper handling of funds by himself,
asserting the failure was traceable
directly TO the depression. He con-
tended he could have saved the whole
structure from collapse If he had been
given free rein.
The Government, in indicting him
for embezzlement as well as on the
concealment charge, pointed out,
however, that thousands of persons
throughout the country were ruined as
the result of Rheem's operations, some
committing suicide on discovering
their plight and others becoming
mentally unbalanced from the shock
of learning their supposedly secure
life savings had been swept away. One
prosperous Florida fruit grower, who
had lost all mis- assets in the collapse
of the firm, was long familiar figure
on the city's streets, carrying a placard
bearing the words, "Huined by Rheeln," "
as he fished into trash baskets and
garbage cans for food.
Rheem was permitted to plead to the
concealment charge after he insisted
on going to trial on the embezzlement
indictment. The Government subse-
quently quashed the latter charge.
La Roe Explains Decision.
In announcing the decision of the
Parole Board yesterday, Wilbur La
Roe, jr., chairman, Saidl
He has now served nearly four
years, which the board deems insuff1-
cient. Nevertheless. it is inconsistent
with the principles and purposes of
parole to require q man, however
serious his offense, to serve his full
maximum sentence if his institution
record is favorable and if it is thought
by the board that he can, with rea-
sonable certainty, be rehabilitated.
There is no question in the minds
of the board that Rheem would, II
released, make a serious effort to re-
habilitate himself. The board prob
ably will not look with favor upon
Rheem's return to the District of CO.
furnbia, but If a satisfactory parole
plan is available so that Rheem can
obtain work in another jurisdiction,
the board, would look with favor upon
his release 10 months in advance of
the expiration of his seven-year term,
with the usual allowance fol-, good
behavior.
This would provide for his release
on November 3, 1885, if his insti-
tutional record continues perfect as
of that date. Parole is denied at this
time, but lis granted, effective No
vember 8, 1885, subject to the con-
dition indicated"
Rheenf Cites Mothers Age.
III making his plea for freedom.
Rheem told the board his mother
Is advanced in years ana needs his
help. In considering this point, 1t
was said:
"The board has every sympathy
for his mother and Is not unmind-,
ful OF the mental suffering to which
she, a wholly innocent person, has
been subjected. but the board must
also consider other persons who have
suffered and are still suffering from
the. applicants wrong doing.
Ii paroling Boyer, the board at
tached a condition prohibiting him
from handling the moneys Of other
persons, selling securities or from
changing his employment without per-
mission of the board. He expects TO
work az a bookkeeper for a lumber
company In Virginia. It was an