Evening star., 1954-10-19

LInIIdyU DuHuHS
In Housing Probe
Two Chicago builders, John
Mack and Nathan Mannilow,
testified today before the Fed
eral grand jury investigating
possible bribery and other mis-
conduct in the Federal Housing
Administration.
Each witness appeared indi-
vidually before the panel in the
United States Courthouse here.
The Government announced
yesterday it was seeking re-
turn of $500,000 advanced to
the Woodner interests which
built the huge Woodners Apart
ments at 1886 Sixteenth street
NV. and other housing projects
here.
The Government action, how
ever. did not involve the Wood
ner projects in Washington.
The grand jury also heard yes
terday two witnesses from Chi
cago. They were identified as
George Dovenmuehle. a mort
gage broker, and Mr.. Mack,
builder.
Information Refused.
Still another development yes
terday took place before District
Judge Bolitha j. Laws. who was
asked to quash the grand jury
subpoena issued for George B.
Pearson, a cab driver OF 3435
Yuma street NV.
MIR. Pearson appeared before
the jury last week and refused
to tell whether he knew Mr..
Powell. His attorney. Ben Paul
Noble, told Judge Laws Mr..
Pearson had asserted his right
not to testify on the ground that
his answers might tend to in
Icriminate him.
Advised by Lawyer.
Mr.. Noble said he had advised
his client to take this course.
He said afterwards Max H.
Goldschein,, special Government
attorney in charge of the grand
jury, had indicated he would
keep Mr.. Pearson waiting in
the witness room until he an
swered questions and keep Mr..
Noble waiting in the corridor
alntil he advised his client to
answer.
"Mr. Goldschein abused the
process of the court" Mr.. Noble
said. He said he intended to
keep us waiting there as long
as he pleased. and it might be
a month" He pointed out that
ilis client had to work as cab
driver to make a living.
After some inquiries Of Fred
b. Ugast. special assistant to
the Attorney General, Judge
Laws ruled that Mr.. Pearson
should be called before the jury
at 10 am. Thursday, and if this
was not done. Mr.. Noble should
renew his motion at noon.
In the action against the
:Woodner, Attorney General Bro
nell filed suit against three COM
pannies controlled by Ian, Max.
and Beverly Woodner. Ian and
Beverly Woodner were listed as
residents of Washington and
New York. and Max Woodner,
of San Antonio, Texas.
S50O,0O0 Sought.
The suit seeks to recover about
$500,000 which the Government
says the Air Force advanced the
companies in 1852. Ian Wood
ner has been questioned extern
Sively about his operations by the
Senate Banking Committee.
The Government contends the
Woodners defaulted on that
amount advanced for completion
of a rental housing project near
Chanute Air Force Base, Ran
toul. Ill.
The Attorney General said the
suit was filed in the Federal Dis
trict Court at Danville, ILL.,,
against the Chanute Gardens
Corp, Chanute Apartments
Corp. and the Jonathan Wood
ner Co.
The Danville suit charges that
the Woodners obtained slightly
more than 100000 from the Air
Force two years ago to complete
the housing projects near the Air
Force base, and defaulted on ap-
proximately $500,000 of this
amount early this year, when
the Air Force took over manage
ment of the projects.
Charges Funds Transfer.
The Government alleges that
at the time of the default, the
Woodners transferred about
. $4,000 from the bank accounts
of Chanute Gardens and Cha
mute Apartments to the account
of Jonathan Woodner Co., leav-
ing less than $500,000 TO the
project corporations, and thus
rendering them inSolvent.
The suit said the Government
holds the stock in these insol-