The E. F. Hutton case was ill-handled, a panel said.

A House Judiciary subcommittee criticized the Justice Department’s failure to prosecute officials of E. F. Hutton & Co. in a check overdraft scheme, contending that the decision left the impression that rich defendants can “buy their way out of trouble.” The report of the Democratic-controlled subcommittee on crime, which squeaked through on a strictly partisan 6-4 vote, was equally critical of the department and the nationwide brokerage firm--which has pleaded guilty to mail and wire fraud.