Page 10


at the bank . and Jo Clifton Sr. Jeffery, John Dolph Everett, and Jesse F. Horner have all pled guilty in Federal Dist. Judge Woodrow Seals’ court to making false financial statements to a bank in connection with loan applications by C. J. Limited. They have not yet been sentenced. Barbara Mears Johnson, Charles Glenn Johnson’s wife, was indicted for Bullock: the south forty allegedly making false statements. She is not standing trial with her husband, however; she is to be tried later. Johnson is before Judge Seals on a seven-count indictment for allegedly making false statements and also for allegedly attempting to “influence and impede” an employee who was appearing as a witness before the grand jury. In his opening statement to the jury, Asst. U.S. Atty. W. Palmer Kelly said that Johnson used the names of 26 people in a scheme to sell Surety land contracts for Summer Place. “Those people didn’t make any down payments to Charles Johnson or his company. They didn’t make monthly payments. In fact, they didn’t even intend to buy the land,” Kelly said. San Antonio Ranch was involved in a number of transactions with Surety Savings during 1976. Surety agreed to get SAR some $9 million in financing \(only $2 million actually came from Surety and and SAR agreed to buy $5 million in first-lien real estate notes from Surety. In addition to the Summer Place notes, SAR also bought notes from Deerwood Lakes North and East in Waller County and from Wildwood Resort City in Hardin and Tyler counties. Wildwood is a Recreation World development. When Travis County Commissioner Bob Honts, one of the owners of San Antonio Ranch, was asked in December about SAR’s relationship to Surety, he said, “We’ve heard all the rumors about Surety. Whatever happens to them doesn’t concern us too greatly. We’re in a tough lending market and managed to borrow the money, and we did so on an honorable basis. We intend to pay them back. I’m sorry if they have problems, but they don’t concern usat least I hope they don’t.” Bullock land for sale State Comptroller Bob Bullock and his real estate partner, Ken Wendler, are trying to sell their 41-acre lot in southeast Austin. That is, Monroe Bethke, president of Citizens National Bank in Austin, is trying to sell the property. Wendler and Bullock borrowed $1.2 million from Citizens in November, 1973. Given the size of the loan, the bank asked Bullock to suggest other banks or bankers that might participate in the transaction, whereupon Bullock suggested his friend Clinton Manges, majority stockholder in the First State Bank and Trust of Rio Grande City. First State bought a participation, which, along with numerous other transactions, caused the Federal Deposit Insurance Corp. to criticize Manges and finally withdraw his federal insurance \(Obs.,Nov. since closed and been reopened under a new owner and charter. Wendler, who is Travis County Democratic chairman, said Citizens National was forced to seek restructuring of the loan by bank examiners. If the land is not refinanced, preferably by bringing in new investors, the bank will be forced to foreclose, Wendler said. According to Wendler, there is no question about the value of the property, which he said has been appraised at $2.1 million. Banking Commissioner Robert Stewart said his examiners are likely to question a speculative real estate loan that has been on a bank’s books for a year or more. A bank may be in a better position to sell land than a real estate speculator, Stewart noted, because it can offer refinancing on attractive terms. Wendler said he and Bullock stand to lose money on the land if it is sold for less than the $1.2 million they borrowed to purchase it. The Democrat has been mentioned widely as a possible candi date for the Austin city council or even mayor in next spring’s elections. He said he could not make a decision on his political plans, however, until “this problem is solved.” 0 Meanwhile, Clinton Manges, the formerly reclusive South Texas rancher, has gotten into more trouble and has been talking about it. Manges was arrested Jan. 11 on a sealed indictment which charged he gave a worthless check for $57,000 to a Corpus Christi tool company. Charged along with Manges was his longtime business associate Morris Ashby. Manges, upon his arrest, blamed Texas Atty. Gen. John Hill for the Manges: a big bounce “ridiculous” charge and told reporters that the check should not have been cashed until he had transferred funds from his defunct Rio Grande City bank to an account in San Diego. When the FDIC’s withdrawal of Manges’ bank insurance led to First State Bank and Trust’s failure, Manges accused John Connally of pulling federal strings to cause him trouble. Now that he is under indictment, Manges alleges that John Hill is misusing his prosecutorial power for political gain. In Austin, meanwhile, Gov. Dolph Briscoe has asked the Legislature to put some more teeth in the state’s banking laws so that regulators will be able to oversee bank and savings and loan purchases. Prior approval is required now only when bank and savings associations are chartered. The governor had previously announced that he would back legislation to supervise changes in bank ownership but he had given no indication that he would do the same for savings institutions. Additionally, Briscoe has asked legislators to help “prevent the influx of organized crime into the state and to protect stockholders and investors in Texas corporations from hostile takeover by persons and corporations of questionable motives and abilities” through passage of an investor protection act. January 28, 1977 27