Agency: FBI
Originator: FBI
From: WALTERS, VERNON G.
To: DIRECTOR, FBI
Document date: 08/23/1962
Document type: PAPER, TEXTUAL DOCUMENT

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' Released under the John F. Kennedy Assassination Records Collection Act of 1992 (44 USC 2107 Hote).

DATE: 11-14-2017

JFK Assassination System

Date:

4/21/201

Identification Form

Agency Information

AGENCY: FBI

RECORD NUMBER: 124-10287-10318

RECORD SERIES: HQ

AGENCY FILE NUMBER:

29-31889-7, 8

Document Information

ORIGINATOR:

FBI

FROM:

WALTERS, VERNON G.

TO: DIRECTOR, FBI

TITLE :

DATE: 08/23/1962

PAGES:

72

SUBJECTS :

DEB, ASSOC, LOANS, PUBLIC BANK, FINANCES

DOCUMENT TYPE: PAPER, TEXTUAL DOCUMENT

CLASSIFICATION : Unclassified

- RESTRICTIONS: Consulted; 2; 3

CURRENT STATUS: Redact

DATE OF LAST REVIEW: 05/26/1998

OPENING CRITERIA: APPROVAL OF DOJ, FDIC

COMMENTS: REFERRED TO DOI, FDIC, INC A/T, RPT, TABLE OF CONTENTS PAGE 2

v9.1

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In preliminary discussion with FRENCH, he advised

that he

has received copies of some progress reports

and

other data from Internal Revenue Service (IRS) concerning

intensive investigation by IRs of the finances of Subjects

TRISCARO and BARTONE, including their interest in the

"Naiman-Niagara" matter.

Information received by FRENCH

indicates that Ins has conducted investigation in ohio,

Florida,

Canada and Central America concerning some of

transactions related to this case and IRS has obtained

copies of certain cancelled checks,

bank statements, and

other documents of interest.

FRENCH has Indicated that he

will arrange for pertinent material from IRS to be made

available for revier in connection with

the investigation

in

this case.

FRENCH has copies of transcripts: of testimony before

the Federal Grand Jury at Detroit by PAUL P.

SODER, JR.

on warch a, 196s, and by barBeRt 1.

GROSFEIG On JulY i2,

1962, concerning this matter

YODEr's testimony

has been

reviewed,

but is

not being summarized herein,

because many of

his answers were indefinite and were

that he

qualilied by

remirks

wanted to refer to his liles (working papers and audit

reports of plante & Morn,

(PA's, Detroit) before giving a

definite answer.

These files have

been subpoenaed by the

Federal Grand Jury,

Detroit; it is contemplated that YODER

will be interviewed in conjunction with &

review of these

files;

and any pertinent information furnished by him will

then be reported.

FOLLOWING IS &

summary of information furnished by

HERBERT T

GROSBERG when be

testified before the Federal

Grand Jury On July 12, 1962:

In 1958

or 1950, at the time of a meeting of the

Teamsters

Fund

In Chicago, GROSBERG was in

Chicago, and received a

telephone

Call fIOM JAMES E. HOFFA,

who

also was in Chicago.

HOFFA said that

two people were coming over to GROSBERG'S

room, that GROSBERG knew one of the persons, and that GROSBERG

was to call Public Bank and

arrange

a loan for these people.

Shortly thereafter, LOUIS "BABE" TRISCARO

and. ALVIN NAIMAN

arrived at GROSBERG'S 500N, bringing with then a linancial

statement

for Niagara

Crushed Stone,

Ita:

The financial

statement, consisting of a balance

sheet and possibly a profit

E

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and loss statement also,

was the one which had been presented

to the Central States Pension. Fund for the

purpose of obtaining

a loan.

NAIMAN and TRISCARD tOId GROSBERG that NAIMAN had not

been successiul in getting & loan from the Central States Pension

Fund because the fund

not permitted to lend to a foreign

corporation.

GROSBERG concluded from the tinancial statement

that the firm was s "going"

concern, but was not "too profitable"

After looking at the statement and while NAIMAN and TRISCARO

were in his room, GROSBERG made & long distance, person-to-person

call to ROBERT E. MC CARTHY at the Public Bank, DetroIt.

GROSBERG TOLD MC CARTHY that NAIMAN was going to contact MC CARTHY

regarding a loan, and that GROSBERG was Calling MC CARTHY

through HOFFA's request.

NAIMAN subsequently went to Public

Bank, but GROSBERG did nOt knOw iI TRISCARO went to the bank.

GROSBErG was Iater told by MC CARTHY land possibly by JOSEPH

VERHELLE,

President of Public Bank) that the loan was granted

by Public Bank.

On more than one occasion while GROSBERG waS in the

International Office of the International Brotherhood of

Teamsters in Washingtol, D. C, VERHELLE and MC CARTHY called

HOFF and discussed this loan and others.

It waS GROSBERG'S

recollection that HOFFA's remoks in reconnending that the above

mentioned loan

be made by Public Bank for NAIMAN were to. the

effect that "Il you could

possibly grant the loan, I would.

like you to grant the loan."

On August 14, 1962, FRENCH

advised that

on March 16,

1962, WALTER J. SHERIDAN of the Department of Justice received

information that at the time of the above mentioned meeting in

GROSBERG's hotel room, GROSBERG already knew TRISCARO and was.

introduced to NAINAN bY TRISCARO. FOllowing GROSBERG'S

call to MC CARTHY at publiC Bank, VERELLE subsequently called

GROSBERG, wanting

moreinfornation.concerning

the Loan.

VERHELLE indicated to GROSBERG

at the time that he

want to make

the loan.

After that,

VERHELLE

called GEORGE

FITZGERALD, an attorney for the

Teansters, and

wanted

FITZGERALD

to help him out of the situation but FITZGERALD

indicated that he was unable todo so.

According to FRENCH,

the above

infornation concerning GROSBERG should be treated

in a confidential manner.

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FRENCH advised that he was going to Miami, Florida,

on August 15, 1962, in connection with a hearing iu federal

Court concerning possible revocation of Subject BARTONE'S

probation.

pertinent

FRENCH advised that he expected to bring additional

information

from the Departent upon his return to

Detroit during the week of August 20, 1962.

C*..

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Released under the John F. Kennedy Assassination Records Collection Act of 1992 (41 USC 2107 Note).

•, DATE: 11-14-2017

D-204 (Rer. 823-58)

• =0

aida

UNITED STATES DEPARTMENT OF JUSTICE

FEDERAL BUREAU OF INVESTIGATION

Copy to:

Dept, Attorney WILLIAM FRENCH,

USA, Detroit

Report of:

Date:

File Number:

SA VERNON G. WALTERS (A)

August 23,

1962

29-1432

Office: Detroit, Michigan

Title:

Character:

Bureau:

29-31889

JAMES RIDDLE HOFFA; DOMINICK EDWARD BARTONE:

LOUIS "BABE" TRISCARO; JACK PRESSER; HERMAN PRESSER;

ALVIN A. NAIMAN; ELIOT JANEWAY; JOSEPH F. VERHELLE;

ROBERT F. MC CARTHY, IRO

FEDERAL RESERVE ACT; INTERSTATE TRANSPORTATION OF STOLEN

PROPERTY; MAIL FRAUD; FRAUD BY WIRE; CONSPIRACY

Criminal Division requested investigation regarding alleged ir

regularities and possible conspiracy in connection with loans

totaling $730,000 from Puble Bank, Detroit, to The Alvin Naiman

Corp., Nagara

Crushed stove (Hunberstone) Itd. (Ncs),

Vendorama of Ohio, Inc. LEDIC Examiner concluded

there were mis-

applications and deceptive entries in comection wth these loans,

since they were

made to for for the beneist off firms which

reportedly insolvent and devoid of earnings, collateral was of,

questionable value, and loan proceeds were

improperly diverted.

Loans were made by Public Bank after ALVIN A. NAIMAN had "sue-

cessfully attempted to obtain Ioan from Teamsters Central States

Pension Fund, to relleve financial problems arising from trans-

actions: o1 Akros Dynamics Corp. and/or operation of NCS.

JAMES

Teamsters officials, re

ROBERT

E. MC CARTHY, JR., Assistant Vice President, and. JOSEPH E.

VERHELLE,

president, Public Bank,- were contacted concerning loans,

allegedly at suggestion of

DOMINICK EDWARD BARTONE,

viously involved

in surplus

aircralt deal of Akros Dynanics Corp.,

acquired interest in NCS with lunds from Servicios Internacionales,

S.A., Of Panama (owned by BARTON? and became general unager

of

NCS

about same

time as first

made by Public Bark Im 1959.

Ncs was placed in bankruptey

• in Ontario, Canada, In 1961. Public

Bank received notes totaling

$800,000 from successor

company,

Port Colborne Quarries Itd, but full payment considered doubtful

by FDIC examiner. VERHElLE resigned as president of public Bank

in 1962, under pressure

Background information

set out regarding

companies and individuals allegedly involved In this matter.

•P

ALL INFORMATION CONTAINED

DATE 10 - 8-94BY SP 8M999/CSK

This document contains neither recommendations nor conclusions of any kind. Is is the property of the FBl, and is a loan to your dency!

it and /or its contents are not to be distributed outside your agency.

18-74625-1

"cPo

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This invostigation Is predicated upon & letter

dated July 31,

196%,

to

the Director, FBI, fron

HERBERT

J. MILLER, ER.,

Assistant Attorney General, diminal

Division,

which enclosed certain

results of scamination

of Public Bank, Detroit,

Michieon, by

the federal

Deposit

Insurance Corporation (FDIC)

together

with allegations of

specific violations and

irregularities.

letter indicated

that beeause of the possibity

conspiracy

requested that the FBI investigate

this

FRENCH and J. PAUL

ALLNED

were

named

matter.

WILLIAM P.

as

Ciminal Division

Attorneys

who are

tamiliar with

this

matter

On

August 6, 1962,

preliuinary discussion

waS

held at Detroit with Mr. FRENCH and

THOMAS E. WINDSEY,

FDIC Examiner;

and arrangements vere

made to

begin reviewing:

material In M. FRENCH'S Office at Detrolt. Mr. FRENCH

indicated that the alleged irregularities to be considered

pertain

to a series

Loane made by Publio

Bank in 1959

which are described

In detail in

letter dated

3, 1902, 120m

THOMAS

E. LINDSEY tO

United States

Attorney at Detroit.

FrENCh requested that

the flov of tunds fron these loans be troced as

possible

and

that information be developed

to a possible conspiracy

involving the

Subjects in this

case.

The

following

in the letter

dated

May

is

3,

& summary

1962,

Lrou

of facte and

conclusions

EDIC

Examiner LINDSEY:

Fublic Bank, Detroit,

kichigat,

bank insured under the

provisions of the Federal

Deposit

Insurance Act. PB is not & nember of the

Federal

Heserve Systen. FB

was chartered December

was authorized to commence business December

1957; has FDIC Certificate Number 17848;

and was

insured

March s4, 1950.

While LINDSEX was participating in an

exaninat ion

o1 p8 as of the close of business

December 26,

1961,

certain apparent irregularities vere disclosed lor

which President JOSEPE L VERNELLE,

Assistant

Vice-President ROBERT E. NOCARTIN,

JR. and possibly

other persons were belleved to be responsible.

Apparent Irregularities in the

nature of misapplications

of funds,

false and deceptive

entries and staterents,

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aiding

and abetting, ets., were spociiically commented

in

conboction

with the

belor-mentioned loans made

at

the

Michigan-Shelby Oftice of PB.

1.

Unsecured Loan

to Vendorana of

Oh2o,

$50

0,400

on Detober 3, 19S0, PB

extended

* $50,000 credit

to Vendorana of Ohio, Inc. (VOI)

as evidenced by an

unsecured note

mumber 7701

VOI for

$50, 000,

dated

October 3, 1960, que Novenber

1960,

executed by

H.A. PRESSER, President, and JACKE

PRESSER,

Secretary-

Treasurer.

This loan was

approved. by PB President

VErHELtE and was fully renewed ty

November 4, 1960,

due

VERHELLE

December l,

1960;

and

renewed

again on March 10, 1901, loan runbers 8184

respectively, the

last note being due

and

10074,

on demand.

The loan was

Finally paid by $30,000

and 4a0, 000 plus accrued

(Ob)

July

1961

interest

$441.66

July 20, 1961.

Although VOI was show to

have

н.А.

and JACKE PRESSER,

been owned by

they reportedly

were

O1 WILLIAN PRESSER, tO whoM

nominees

they are

related

and

who

allegedly

is the real

WILLIAM PRESSER 16

reported to be

• Chairman, Ohio

Conference

Teamsters;

President, Joint Council Number 41 ot

International

Brotherhood of

Teansters,

Cleveland:

trustee

01

the International

Brotherhood

teamster's

Pension

Fund.

The

source of the above mentioned $30, 000 payment

was a

demand loan nunber 12322

p3 to Dojay of Ohio,

Inc., Ior $60,000 dated July 21,

1960, executed by

ELLIOT JANIVAY and personally

endorsed by kin.

loan was approved by President VErtElE and OnlY

$1,500

had been paid on this loan at the time of the

FDIC examination.

rhe above

$30,000

payment

VOI loan

wes ellected by d

memorandun charge

against the checking account

PE o1 Dojay at 0h10,

Inc.

This charge was esecuted

Assistant

Cashier-Note

Teller,

OI PB. The $20,000

principal

payment and interest

sx+14.sl

-4.

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payment

o1 $441.66 were represented by

' a check for the

total

of

these

anounts, maker

presently unknown,

the

check being drawn

on or cleared

through the Manufacturers

National Bank, Detroit.

VOI reportedly was

engaged

In vending machine

operations in

Cleveland, Ohio,

and vicinity during the

May 8, 1961, FDIC examination

OF PB,

the Franiner in

Charge, WILLIAM D. ALLEN reportedly was lalsely informed

by President vErnELlE that the

businoss of vOI was

that

of extending credit to Niagara

Crushed Stone. (Humber-

stone). Limited

o1 Port Colborne, Ontario, Canada.

On August 26,

1961, there

was. tiled a report

dissolution

and sale

Industrial Vending

Company, GEORGE GOLDEN, President, 7505 Carmegie,

Cleveland.

The proceeds

disbursed

Oin

October

the

3,

$50,000 1oar by PB to VOI were

1960

LOLlOWS:

$2,868.77

Applied

as partial payment on

note number

• 3556

of The Alvin

Naiman, Corporation, Cleveland,

Ohio (ANO)

to PB

$2, 862

Applied as partial payment on

note number 3557 of Nagara

Crushed Stone

(Humberstoce)

Limited (NCS)

to PB

$26,540.21

Credited to cash collateral

account

In Ps for the benefit

of NGS

$12, 008.69

Wire

transfer by pe through

Imperial Bank of Canada,

Windsor, ontario, to

Toronto-Dominion

Bani,

Crowland,

Ontario, for account

Of NCS

5

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$5,725.56

Converted to PB Cashiers

Check Number 1-21403, payable

to Bantan Industries,

Ind.,

Boston,

Massachusetts,

representing tro

paynents. of

$4, 868. 78 each on loans to

NCS and

ANd by tD,

Loans

5370

and

5369,

sold to

Bantan Industries, Inc., by

All disbursement entries in connection with the

above

VOI loan

transactions were effected on the books

of PB by weans of intra bank debits and credits only,

originated by various

bank personnel.

The proceeds of

this loan did not flow through

account for vol, but

instead wore distributed as indicated directly from

the

loan and

were

entirely used to aid the finances

ANC and

NCS.

On File

in PB is an unaudited financial statement

dated Decenber 31, 1960,

o1 ANC in support of its

direct loans trom

DB. This statement was prepared by

the Detroit CPA Firm of Plante

and reflects

net

insolvency in the anount of

$934, 100•

The statement

indicates ANC cash was overdrawn. F1, 300.

Another

Iinancial statement of ANC dated September 30, 1960,

contained in PB file,

showed

not

insolvency of $66%, 600

cash

overdrawn $20,900.

This statement which also

was prepared by

Plante and

Moran,

shows ANC had & not

$265,600

during the preceding seven

months.

A

linancial staterent of ANC dated December 31, 1959,

contained

IN PB LILO,

reflects

not

insolvency

• 01

$506,200.

Also

contained

in PB credit files

is a

financial statement dated

September 30, 1960, 01 NCS

in support of its direct loans from PB.

This statement

rellects

net insolvency of. $63, 200

and indicates that

NCS had

an additional

operating

loss during the statement

period of approximately $50,000.

A bank overdraft of

$42, 000 vas

indicated

A financial

statement of NCS

dated November 30, 1959, showed net insolveney of

$338,100 and

net

operating loss of

NOS for an eleven

month period

in the

amount

01 $293, 344.

=6.

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The only

support in PB

Files

for the

$50,000

loan.

to VOL was

vor financial

staterent dated

January 31, 1961,

which showed a

delicit

01 $37,300,

a net.worth 01 $15, 700, and an operating

loss for

the

January

1958 to 1961 showed repeated

eat a losses

vor tax returns

for

and insolvency.)

As shown by the

foregoing, PB through its

President, JOSEPH I. VERIELLE, advanced $50, 000

of PB lunds in

the name of VOl, an insolvent firm

devoid

earnings.

These funds were diverted by

PB and used for the beretit of two other

Firms,

ANC and NeS,

also autolvest and devoid of

earnings

at the time.

This advance

would

therefore appear

to be a misapplication of PB lunds

in violation of

Title 18,

United States Code,

Section 656.

Furthermore,

the deceptions employed by PS management in the

negotiation of the above vor loan and the diversion

and

wse

the

proceeds thereof would appear to

be

violation

of Title 18, United

States Code, Section

1005.

• 2.

Insecured

Joan

to rhe Alvin

Naiman Corporation - $50

0, 000

On October 16,

1939, PB extended a $50,000 credit

to ANC as evidenced by an unsecured note

number 3480

OI ANC IOr 550, 000, dated Detober 16, 1952, due on

demand, executed by DOMINICK E BARTONE, ViCe- President

and Treasurer.

This loan

was approved by PB President

VERHELLE and Assistant Vice-president ROBERT E.

JR.

The proceeds of the note were

fully

converted into PB cashier's check number 1-9699, dated

October

1959,

For $50,000.

Tho

cashier's check is

payable to

ANC and is signed

by ROBERT A. DORST,

Assistant Cashier-Note Teller.

This cashier's check

is endorsed

ANC bY DOMINICK E. BARTONE, ViCe-President,

and is additinally

endorsed Niagare Crushed

Stone

(Humber'stone)

Limited by I. D'AMICO and was negotiated

through

the

Toronto-Dominion Bark, Crowiand, Ontario.

proceeds of this

loan vere used to Lacilitate

the purchase by ANC of NCS

and was the first

series

advances made by p to. finance the purchase

and ostensibly the operation of NOS

and

Of ANG.

This

loan was

Iully eliminated

october 24, 1959, from the

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proceeds of

additional loan by PB tO

ANC LOI

$240,000.

The

$50,000 loan plus interest

of

$60.06 was Inmediately deducted from the

$240, 000

loan

and the reminder, $189,931.94, was

credited

to the ANC checking account

In PB.

The only support on

11le in PB for the above

$50,000 lOan tO ANC 15 *

financial statement of

ANC dated December 31, 1960, which shows the firm

was then insolvent to

the extent of $934, 053 and

Its cash was overdrawn $1, 300.

Other Linancial

statements of ANC contained in PB files showed

that

during the period of 1958

1960, there was &

progressively increasing cordition of insolvency

and operating losses.

The

Loregoing

Indicates that advances were made

by PS through President VERHELLE

and

Assistant

vices

President MeCARTHY in the sur of

$50,000 to ANC which

was hopelessly insolvent and

devoid of earnings.

These advances, therefere, appear to

constitute a

misapplication o1 PB funds in violation of ritle

18 g

Section 656.

PB also failed

have the above note signed by two of the borrower

firms otficers although the borrowing resolution in

connection with this line of credit required the

signatures of

such officers

note obligations.

3.

Unsecured loan to the Alvin

Naiman Corporation - $240,000

On October 24, 1959, PB granted

* loan of

$240, 000 to ANC.

The note

was executed by

ALVIN

NAIMAN, President, and DOMINICK E. BARTONE,

Vice-President.

The loan

WaS

entered upon

the

bank's books October 24, 1959, and was approved by

the PB Board

o1. Directors on October 23, 1959.

was also approved by president VERHELLE; and Assistant

Vice-President MCCARTHY assisted in the negotiation

and closing of this loan.

As indicated in number 2

above, a previous loan of ANC was paid from the

proceeds

of this loan and the reminder was credited

to the checking account of ANC.

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This loan

was secured by alleged first and

second liens on real estate

quarTy of NCS at

Port Colborne,

ontario; by alleged first and

liens on equipment of NCs; by alleged first and

second

liens on certain machinery of ANC; by alleged blanket

assignment of

accounts receivi lot both ANC and

by alleged assignments of inventory of each company;

by pledges of stock of each company; by various

unsupported cross guaranties of ALVIN A. NAIMAN,

MARIE NAIMAN, DOMINICK E.

BARTONE, ANC and NCS; and

by subordination agreements regarding debts due

ALVIN NAILAN, SERVICIOS INTERNACIONALES, ADAmA, and

ANC. All of

this collateral was pledged

to secure

not only the subject loan, but also a $240, 000 10am

to NCS discussed under number

3 below, and subsequent

advances.

There were indications that a large portion,

not all proceeds

subject loan vere diverted

to the direct use and benefit of NCS, SERVICIOS

INTERNACIONALES, an IntereSt Of DOMINICK E. BARTONE,

and to BARTONE personally.

These diversions were

accomplished through conflicting cross accounting

entries which made &

complete

and accurate determination

in this

regard inpractical at the time of examination.

On January

4, 1961, 9

receiving order was

issued to effect a state of bankruptcy as to NCS, and

it was actually placed in barkruptey in July, 1961.

Subsequently, a new

corporation

was forned, Port

Colborne Quarnies Linited of Port Colborne,

Ontario.

PB filed & claim against the bankrupt estate

which claim included its

Joans to ANC and NCS, then

having

balances approximating

$216, 96% 03, PLuS

items.

settlement

clain amounting

to $837,506.16, In total, PB received notes totaling$ 800,000

of Port Colborne Quarries Linited.

ultimate liquidation

to be expected from these latter notes is in serious

doubt.

In vey of the previously mentioned insolvency

and consistent lack

earnings

ANC, the questionable

value of the security pledged to subject loan, the

apparent improper diversion of loan proceeds to

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purposes

other than those represented by the bank's

recoras.

the continued bad management of ANC,

and

the continuing doubtful crospects ot recovery by PE

of the

full amount of its advances,

subject loan

appears

to constituto a misapplication of funds under

Title 18, United States Code, Section 656.

4: Secured loan to Niagara Crushed Stone

(Humberstone) Limited - $240,000

on October 24, 1959, PB granted & Joan to NCS

for $240, 000.

The note was executed by ALVIN

NAIMAN, President,

and

DOMINICK E. BARTONE, ViCe- President.

This credit was approved by PB'S Board of Directors

on October

23, 1959,

and was

entered upon the bank's

books on October

1959.

The loan was approved by

President VERHELLE; and Assistant Vice-President

NCCARTIY assisted in

the loan.

the negotiation and closing of

The

entire proceeds were

credited

immediately

to the NCs checking account in PB.

The loan was

also

secured by the

same collateral allegedly pledged

to the

ANCH 5a40,000 J0am

discussed under number

3 above.

In .

addition to the information previously set forth concerning

the insolvency

•and

operational losses of NCS, financial

statements prepared by JAMes N. DuNwoOdy and Company,

chartered accountants,

Toronto,

ontario, showed the

following information

as'ot the dates indicated:

Date

12/31/58

6/30/59

12/31/59

6/30/60

Not L08s

$138,000

$123, 800

$404,900

$137, 400.

Insolvercy

$ 43,200

$167,000

$148, 100

$585, 600

From the foregoing, it appears that NCS was an

operating failure and insoivent considerably prior

the do got had

to the granting of subject loan by PB and that these

conditions worsened subsequent to

the granting of the

10a0.

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VGW: kam - 9

As pointed

out under number 3 above,

PB filed

a claim for its loans to both

ANG and NCS against the

bankrupt estate. of NCS.

In settlement of its claim,

PB received notes aggregating $800,000 of Port Colborne

Quarries Limited.

Ultimate payment

of these notes

depends entirely upon the future

operating success

o1 Port Colborne Quarries Limited

and is in doubt due

to the firm's showing to date, its undercapitalized

position and the operating failure of its predecessor.

In view of all

the above circumstances, subject

loan

appears

to

constitute

& misapplication

o1 funds

under Title 18, United

States

Cade, Section

656.

5.

Secured loans: to: Niagara

Crushed Stone

(Humberstone): Limited - $75,000; and

to: The Alvin

1 Corporation - $75,000

On AprIl 7,

1960,

PB granted loans to the above

named firms for

$75,000 each, being numbers 5369 and

5370, respectively.

The loans were payable in monthly

installments and

participated fully in the same

security pledged to the loans of these firms

described

under number 3 and number 4 above.

The loans were

approved by President VErHELLE and the proceeds were

innediately credited to the respective borrower firms'

checking accounts in PB. At the same time, both loans

were fully

sold, without recourse, under a

arrangement to Bantam Industries,

participation

Inc., Boston,

Massachusetts.

particlpated Loans were

included

in the PB claim against the bankrupt estate of NCS as

out in number 3

number 4 above.

Apparently for

his services in this matter, the

attorney

For Bantam

Industries,

JOEL A. KOZOL, received

a lee of $1, 500 as evidenced by

check in that

• April

4, 1960, payable to JOEl A. KOZOL, drawn

on the ANC checking

account at PB and executed by

DOMINICK E. BARTONE, ViCe-President.

As consideration

for participating in

subject Loans,

Bantan Industries,

Inc, required payment thereto of a fee of $30,000.

This payrent was

charged on April 7,

1960, to the ANC

checking account in PB

as eridenced by ANc check dated

April 4,

1960, Ior $30,000, executed by DOMINICK E.

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DE 29-1432

office. He said that he did not know what GROSS was doing

there.

He recalls something being mentioned about TRISCARO

being

in difficulty in Florida. He said that BARTONE made

many

trips to Miami during this period and ran up a $12,000

bill

with Eastern Airlines. He said that BARTONE brought in

an attorney named GONOONE from Toledo to represent the Company.

He said that he believes that the company still owes GONOONE

about $5,000.

NAIMAN said that the Companies were still in need

of money and in approximately April, 1960, BARTONE tOld NAIMAN

that they were going to obtain another $150,000 from the Public

Bank of Detroit.

He said that he and BARTONE went to the

Public Bank and met with VERHELLE in his office. Also present

was an attorney named KOZEL representing a lending organiza-

tion called Bantum Industries, Boston, Massachusetts.

NAIMAN

recalls signing a check in the amount

of $30,000 which he

understood was interest on the loan. He also signed a check...

for $1, 500 to KOZEL.

He said that the net proceeds of the

loan therefore were less than $120,000. NAIMAN said that the

proceeds of the loan were split between the Alvin Naiman Corpora

tion and the Niagara Crushed Stone Corporation.

He said that

the total indebtedness to the Public Bank was being paid back

at $5,000 a month.

He believes that they paid back a total

approximately $100,000.

NAIMAN said that to approximately July, 1960, his

son became extremely upset because the Corporations were in

dire financial straits.

His son got into an argument with

BARTONE and when BARTONE started berating his son, NAIMAN

slapped BARTONE. He said that BARTONE thereupon left but

returned the next day to apologize.

NAIMAN said that he told

BARTONE that he wanted to get rid of the business and give

BARTONE power of attorney for this matter.

He said that the

next thing he knew the Corporations were in bankruptcy.

NAIMAN said that he then decided to see what he

could do to remedy the situation and went to Canada to talk

with Mr. McGRIFFIN of the Canada Steamship Company which had

taken over the Niagara Crushed Stone Company.

He learned

from MCGRIFFIN that his Company had assumed $700,000 in debts

to the Public Bank of Detroit. NAIMAN said that he could not

understand how the indebtedness could still be that high when

they had paid off $100,000 and had only borrowed a total of

$630,000.

NAIMAN said that in addition he learned that BARTONE

had assigned $240,000 in good accounts receivable to the Bank:

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