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# HIATT'S NAME NOT MUCH IN EVIDENCE IN
# HIS MANY TRANSACTIONS IN REAL ESTATE
W. H. Blodgett, staff correspondent, Mississippi, called at the Brock build-
of the Indianapolis News, has made an ing, in Anderson, and informed Mrs.
Investigation and E. F. Hiatt's specula- Myrtle Cloyd, agent for the Brock
tions. The appended article from the Realty company, that Mr. McLemore
News is one of a series: had taken over the building and that
the rental was to be paid to him.
RICHMOND, Ind., April 6.-The spe-
cial committee that is making an in-
vestigation of the affairs of Edgar F.
Hiatt, former president of the Dickin-
son Trust company, which was closed
a short time ago by the state banking
department after it was revealed that
there was a shortage of $661,000 in the
bank and which has now been reopen-
ed, has found that Hiatt's name did
not appear in many deals in real estate
the committee says he made with the
money and securities belonging to the
trust company. This was particularly
true in his methods of handling apart-
ment buildings.
Mr. Hiatt's plan, as set out to the
committee, was to use the money and
securities of the trust company to
finance a deal for an apartment, using
land dealers to carry the deal
through. His plan, it is said, was to
organize a stock company for the pur-
chase of the particular apartment prop-
erty he had in mind. This company
would issue common stock to two or
three persons in the company that was
to take over the particular apartment
building that Hiatt was after. Then
a certain amount of preferred stock
would be issued to the members of
the company, but this stock had no
voting power.
Payment of Dividends
These shares of stock would be reg-
istered through the Dickinson Trust
company and the stockholders would
have no knowledge of the actual own-
ers of the securities that were used in
the deal. The investigating commit-
tee asserts that not only would Hiatt
take money and securities from the
Dickisnon Trust company to finance
the apartment deals, but he would take
money from the Dickinson Trust com-
pany to pay dividends on the stock
that was to buy the apartment.
Besides this, it is asserted by the
investigating committee that Hiatt
would use the money and securities
of the Dickinson Trust company to
repair and maintain the property. At
different times Hiatt was interested
in the Glass block, at Marion; the
Brock block, at Anderson; the Wayne
apartments, at Richmond; the Maxim
building, at Newcastle. As far as has
been learned by the investigating com-
mittee Hiatt at this time has no equit-
ies in any of these properties from
which the stockholders of the Dickin-
son Trust company can get returns.
The deal by which Hiatt obtained
an interest in the Brock block, at An-
derson, was started by Albert Gregg,
real estate operator in Richmond. Mr.
Gregg said that Mr. Hiatt asked him
to look over the building at Anderson,
and later told him to take a deed to
the building and manage the property.
After six months, Gregg says, Mr.
Hiatt said that the building had been
turned over to the Brock Realty com-
pany.
What Records Show
An examination of the records at
Anderson by the investigating com-
*mittee shows that Albert W. Gregg,
of Richmond, bought the Brock apart-
ment building from Frank Brock, of
Anderson, for a sum of approximately
$160,000. At the time of the sale there
were two mortgages on the property,
one for $40,000 held by the Provident
Life and Trust company, of Philadel-
phia, and the other for $33,000 held by
the Citizens bank, at Anderson.
The Brock Realty company, of An-
derson, was organized with a capital
stock of $225,000, which capitalization
was later reduced to $200,000. The
stockholders and officers of the Brock
Realty company were Albert W.
Gregg, president; Robert J. Buck, sec-
retary, and Edgar F. Hiatt. The $33,-
000 mortgage held by the Citizens'
bank, at Anderson, was released in
July, 1921, by an Indianapolis bank.
The understanding is that Mr. Brock
in disposing of the property accepted
about $60,000 worth of notes for the
building and that some of those notes
have later proved to be of doubtful
As to Rental Money
This rental money, it was under-
stood, was paid to Mr. McLemore up
until February 1, of this year, and
since that time the rental money has
turned the building back to Mr. Hiatt
account because Mr. McLemore has
turned the building bac kto Mr. Hiatt.
The Dickinson Trust company was
the depository for the funds of the
Brock Realty compnay. The Brock
Oil Products company, of which Frank
Brock was president, is in the hands
of a receiver, the former stockholders
of the concern having had the Ander-
son Trust company appointed to that
position.
The Wayne Apartment company of
Richmond was originally formed by
John W. Mueller, Turner W. Hadley
and Wilfred Jessup, with a capital
stock of $50,000, but a few days later
the articles of incorporation were
changed to provide for $100,000 of
common stock and the same amount
of preferred stock. Edgar F. Hiatt
was a stockholder in this company
and the claim of the investigation com-
mittee is that the property was really
bought by Hiatt with the money of
the Dickinson Trust company, that the
expenses were kept up by funds of
the Dickinson Trust company, that div-
idends on the preferred stock issued
by the company were paid from funds
of the Dickinson Trust company, and
that the rentals of the Wayne apart-
ment went to Mr. Hiatt, and that Mr.
Mueller, Mr. Hadley and Mr. Jessup
received no benefits from the deal
and, as far as has been ascertained,
received no money or securities that
was the property of the Dickinson
Trust company.
Hiatt in Background
The same way of obtaining control
was used in getting the Maxim build-
ing at Newcastle, it is said. The in-
vestigating committee has not yet
gone far enough into the Newcastle
end of the deal to determine whether
or not Hiatt still has an interest in
that building or whether there is any
chance for the stockholders of the
Dickinson Trust company, which was
reorganized and the bank reopened
last week, to be reimbursed for the
money the committee says Hiatt put
into the building.
The committee has found few in-
stances where Hiatt appeared promi-
nently in these real estate deals. He
did not appear to any great extent
in the real estate deals of Indianapolis
and for that reason he did not pay
any taxes in Marion county on the
property in which he was interested.
It has been reported to the investi-
gation committee that on the Chicago
properties Hiatt received about $92,-
000 a year in rentals, and that none
of this money was turned in to the
Dickinson Trust company, although
the money and securities of the Dick-
inson Trust company were used ac-
cording to the committee's statement
in financing the Chicago deals. Be-
cause of these things, members of
the committee believe that Hiatt still
has resources that have for some rea-
son not been turned over to the stock-
holders of the Dickinson Trust com-
pany, and a probe will be made to
ascertain whether this condition real-
ly exists. Friends of Mr. Hiatt say
that bad trades and general conditions
in the real estate market is the cause
of the failure, and Mr. Hiatt to a friend
said that he felt satisfied that if he
had not been interferred with he would
have been able to work out all of the
deals and no one would have lost any-
thing. It is understood that Mr. Hiatt
does not deny he used the money and
securities of the Dickinson Trust com-
pany in financing certain of these
deals, and will, it is thought, in a short
time make a public statement setting
forth all the details of his participation
in affairs that caused the failure of the
Dickinson Trust company.
