The Washington times., 1938-06-02
PHILIP FR E AR
REFUSES RETURN
TO new YORK.
FinanCier Accused As
SWindIer
BY JAMES CULLINANE

BY JAMES CULLINANE
Philip A. Frear. A, wealthy
Washington broker accused of par
ticipating in $16,000,000 securi-
ties swindle, refused to return to
New York voluntarily when he ap-
peared in Police Court this morn
ing.
He described as untrue" how
ever, reports he intended to fight
extradition. He said:
II have not yet seen the in
Gictment, nor have I been con-
fronted with the formal charges
in the action"
Frear's attorneys, William C.
Sullivan and Carroll Hayes, said
the broker will take advantage O.
the usual 80 days delay allowed
on fugitive warrants to study the
indictments returned against him
and five other alleged co-conspira-
tors by the New York grand jury
yesterday.
IMPOSING FIGURE
Smartly dressed and with his
spiked mustache criSply waxed,
the dapper broker was an i'm
posing figure when he appeared
among the petty offenders in Po-
lice Court.
Calmly he insisted that he was
innocent of any wrongdoing in con-
nection with the New York Sc
curities transactions. His attor-
neys indicate Frear's fight
against extradition may be drop
ped after they have had an oppor-
tunity to study the charges against
him.
Frear, son of former Representa-
tive James A. Frear of Wisconsin,
was arrested in his office suite in
the Woodward Building yesterday
after police here received word
from District Attorney Thomas E.
Dewey in New York that he was
wanted there on a charge of grand
larceny of 100000.
Three of Frear'S alleged accom-
pliceS in an involved series of
transactions which, according to
Dewey, brought them control Of
investment trusts worth $16,000,-
900 after a capital investment Of
only SIS, were taken into custody
in New York and Boston yester-
day. Two others were being sought
by police today.
Those arrested besides Frear
were Vincent E. Feretti New York
attorney. and Thomas w. Morris
and Ralph H. Robb, Of Boston.
Feretti is held under $25, 900 bond.
Morris and Robb each posted
&5, 900 bond. s...
Ten counts are contained in the
indictments against the six men,
Conviction on all points would
mean a maximum sentence of 100
years in prison for each defendant.
Dewey said the six men acquired
control of the First Income Trad
ing Corporation, Con tinental
Securities Corporation, Admins
tered Fund Second, Inc, and Reyn-
olds Investment Company. Three
Of the men-Dewey would not re-
veal which three-are also accused
Of gaining control of Burco, Inc,
Bond and Share Trading Corpora
ton and Insuranshares Corpora
ton Of Delaware, Inc.
8 MILLION ASSETS
When the men acquired control
Of Continental Securities Corpora
ton in October, 1887, Dewey said,
its portfolio contained marketable
assets of $4,000 900. Last March
the corporations assets were worth
only $50,000, the prosecutor said.
Investigators, Dewey said, traced
the alleged swindle back to the
formation of the Fiscal Manage
ment Company, Ltd, a Canadian
holding company, which, he al
legged, had a paid-in capital of only
S.. The company, he said, issued
stock which was used in acquiring
control of the investment trusts.
The six accused men were
among Al individual and corporate
defendants against whom States
Attorney General John j. Bennett,
jr., of New York, secured tenn
porary restraining order prevent
ing them from dealing in certainI
types of securities in New York
last Friday.
The Securities and EXCHANGE
Commission then took UP the in
vestigation and ordered Frear and
other brokers to appear at a hear
ing scheduled for today in New
York. Frear said he had packed his
bags and reserved passage on al
New York airline when he was ar
rested. The SEC hearing will be
held despite Frear'S arrest. Robert
E. Kline, assistant to the general
counsel, said last night.