Newspaper article THE JOURNAL RECORD

Former Maryland Thrift Owner Indicted by Jury

Newspaper article THE JOURNAL RECORD

Former Maryland Thrift Owner Indicted by Jury

Article excerpt

BALTIMORE (AP) - The former owner of Merritt Commercial Savings & Loan Association and three former co-owners have been indicted on charges stemming from allegedly illegal activities before the institution's collapse in 1985.

A federal grand jury on Wednesday named Gerald S. Klein, who owned 100 percent of the association when it collapsed, and three former co-owners, Robert V. Gibbs, Eugene Hettleman and Milton Sommers, in a 40-count indictment.

The federal racketeering and mail fraud indictment charged the men with issuing misleading financial statements, giving millions of dollars in unsecured loans to entities controlled by Gibbs and Klein, conducting deliberately inaccurate appraisals and operating a continuing criminal enterprise.

If convicted, the men could forfeit about $45 million in property obtained by the alleged racketeering activity, according to federal authorities.

Merritt was one of the largest Maryland thrifts closed by the state in 1985 during a crisis involving the state's privately-insured savings and loan institutions.

The four probably will be arraigned before a federal magistrate next week, Breckinridge Willcox, U.S. attorney for Maryland, said Wednesday.

Klein, Hettleman and Sommers could be sentenced for maximum terms of 265 years, while Gibbs faces a maximum of 180 years if convicted on all counts.

Klein, a Baltimore attorney, owned half of Merritt from May 1982 to November 1984. Gibbs sold his half interest to Klein in November 1984.

Hettleman owned 10 percent of Merritt prior to the purchase by Klein and Gibbs. Hettleman also was legal counsel and a director of Merritt until it collapsed. …

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