Evening star. [volume] (Washington, D.C.) 1854-1972, 1951-12-20
Indictment Of Young
And Others Is First
Phase Of RFC Probe
By Robert K. Walsh

1'ASAA 4Su4AS, 11CA oS1IC1 1UuIlS, JO-
seph H. Rosenbaum and Robert
w, Dudley mark only the first
phase of grand jury inquiry into
Reconstruction Finance Corp.
dealings, Justice Department Of
fcials said today.
The District grand jury. which
yesterday returned a total of Is
counts against the Young broth
erS and the two Washington law
yers, will reconvene early next
month. Since last spring, follow
ing Senate subcommittee disclos-
ures Of influence" touching RFC,
the jurors have been looking par
ticularly for possible violations of
the bribery, perjury. fraud and
false statements and conspiracy
laws" Justice Department off,
Gals said.
Merl Young said in Florida last
night he would not comment until
he studied the indictment. The
others were not reached for COM
ment, but close friends reported
that all four defendants would
light the charges. No date has
been set for arraignment.
Merl Young, 40-year-old Mis-
souri, native whose wife was
White House stenograrher, was
indicted on three counts. They
charged he testified falsely twice
last February 81 to the subcom-
mittee and once to the grand jury
last Monday.
Was Messenger in 1910.
Now operating a motel near
Miami, Fla, he rose from a 81 1850
o year Government Accounting
Office messenger in 1910 to a
e7.000-a-year RFC examiner in
l948. Later he got jobs paying
$4,000 and $4,000 as Washing
ton representative of the LustronI
Corp. of Columbus Ohio, and the
F. L. Jacobs Co. Of Detroit, both
RFC borrowers. He had entree
to the White House and was de-
scribed by the Senate subcom-
mittee as an "expediter."
Herschel Young. who lives at III
West Thornapple street, Chevy
Chase, did not testify at subcom-
mittee sessions. But as a result
of his appearance before the grand
jury last September 20, he was
indicted on five counts
The principal charges were that
he lied when he denied he ever
represented any one before the
RFC. The indictment alleged that
he had represented the Buffalo
Weaving and Betting Co. of Phila-
delphia. the Tucker Corp, a
Chicago concern, which planned
to make automobiles and the
Peerless Tool and Engineering Co.
of Chicago. 4
Rosenbaum, who represented
many clients in RFC loan negotia-
lions, lives at an estate called Bal
lantre at Mclean, Va. He and
Merl Young figured in testimony
that the latter's wife, Mrs.
Lauretta Young, had a $500
royal pastel mink coat. Rosen-
baum admitted he paid S.
500 for it to a New York furrier. a
client of his in an earlier RFC
loan matter. Young explained the
payment was in the form of a loan
and that he repaid it.
The six indictment counts
against Rosenbaum, however, had
nothing to do with the mink coat.
Charged With Denying Boasts.
They charged that he falsely
told the Senate subcommittee he
never boosted of having had some
former RFC directors "in his
pocket" or that former Director
William E. Willett had sought his
advice and assistance" The in
dictment declared that he made
such statements at a meeting with
the Lustron Corp. representatives
in the Wardman Park Hotel in
February. 1850.
Rosenbaum also was accused Of
lying when he denied having told
the Lustron representatives that
Mr.. Willett asked him to draft a.
resignation letter for Merl Young.
At that time Young was a vice
president of the concern, which
made pre-fabricated houses.
One of the indictment charges
against Merl Young was that he
falsely testified he had nothing to
do with Lustron's loan applica-
tons to RFC while he was an RFC
employe. Another count charged
him with perjury in telling the
subcommittee that his only in
come. after leaving the agency,
was in salaries or advances from