Evening star. [volume] (Washington, D.C.) 1854-1972, 1956-03-01
Coastal Trust
Ownership
Questioned
BY DONALD B. HADLEY

Of Coastal Finance Corp. in the
form Of a trust with Frank B.
Bush, former president. as trus-
tee was questioned late yesterday
at the close of a second day of
hearings on company affairs at
the Securities and Exchange
Commission.
Mrs. Dorothy White, assistant
secretary. who brought subpoe-
lnaed Coastal records to the SEC
hearing. testified she had never
been told officially who the real
owner of the block was. but that
she understood it was Mrs. Vir-
ginia Dallam.
Walter E. Joerg, partner in
the accounting firm of O'Con-
nell g. Co., who also was called
to the witness stand, said Mr.. or
Mrs. Dallam was the owner. but
the hearing came to an end be-
fore the identity of Mr.. or Mrs
Dallam was discussed fully.
Maryland Official
However, the Star has been in
formed that the Mr.. Dallam re-
fefred to is John Dallam, Deputy
Small Loan Commissioner of
Maryland. Mr.. Dallam, several
weeks ago, told The Star his
wife is the owner of Coastal
shares through trust.
/ James G. Ewell, SEC exam
liner presiding at the hearings,
asked Mr.. Joerg whether he
knew why the ownership Of the
shares was listed in this way,
and Mr.. Joerg said no. Mr.. Ewell
then wanted to know whether
Mr.. Joerg had ever asked Mr.
Bush the reason, and the answer
again was no.
/ Mrs. White listed holdings Of
the trust as 1914 Glass A COM
mon shares, 109 Glass B common
shares and 657 shares of 6 pei
cent preferred stock.
! Personal holdings of Mr.. Bush
and his wife, Lucille D. Bush, ir
joint ownership were listed a:
4,700 Class A common and soc
Class B common shares.
Trust Study Expected
i In pursuing its contention that
all transactions in securities
we're not properly disclosed in
the Coastal registration state
ment filed with the SEC in con-
nection with a stock offering last
August, it is expected that the
trust will be given further study
Mrs. Whites appearance with
company records brought on a
short exchange between Daniel
IL. O'Conner. attorney for Mr.
Bush. and SEC counsel.
1 Mr.. O'Conner protested that
more records should have been
supoenaed, but the SEC repre-
sentatives insisted they had Sc
lected only the ones they wanted
for their case. The SEC counsel
indicated that, if Mr.. O'Connel
wanted the additional records
he would have to subpoena
them himself.
j. Martin McDonough, counsel
for William E. Brashears, trustee
for Coastal under Chapter 10 OF
the Bankruptcy Act, said the
trustee would release more rec
iords only on presentation Of a
subpoena.
/ James j. Sanders, another
partner of O'Conne,l & Co.
wound up almost two days OF
testimony yesterday For most OF
the afternoon, he answered ques-
toned of Seymour J. Rubin, at
itorney for a stockholders COM
mittee, and Mr.. O'Conner.
Tells of "Slush Fund"
He gave more details of "slush
fund.-" which he said was usec
to make delinquent small loan.
accounts of Coastal Finance lool
as if they were on a paying
basis.
Mr.. Sanders could recall nc
evidence that officers of Coastal
Finance knew of the irregular
titles before they were first dis
covered by him in the Arlington
office in August shortly after the
registration statement questioned
by the SEC was used for the
stock Offering. However, he sale
Irregularities were found in II
of the company's IL operatine
offices.
AS soon as he found the irreg.
u)arities, he testified, he in