Former Compton Councilman, Wife Arrested in False Loan Deals

A former Compton City Council member and publisher of the weekly Pasadena Gazette and the Los Angeles Metropolitan Gazette was arrested Friday on charges of falsifying loan applications and lying to a federal grand jury.

Hillard Hamm, president of the West Coast Black Publishers Assn., was taken into custody by U.S. Marshals with his wife, Beverly Jean, during the group’s convention in San Francisco. His wife is charged with conspiracy and making false loan statements.

A federal grand jury indictment returned Thursday alleges that the Hamms obtained more than $240,000 from a variety of Southern California banks by submitting false names and income tax returns with their loan applications.

The indictment also charges Hamm, 60, with lying to the grand jury about his connections with John DeMattia, one of 15 alleged mobsters arrested in a recent federal crackdown on organized crime in Los Angeles.

Allegations in Indictment

According to the indictment, Hamm told the grand jury that he had never met or dealt with DeMattia. But according to the indictment, federal investigators have evidence that DeMattia may have assisted Hamm in obtaining loans from Sun West Bank.

The indictment reveals that the grand jury is investigating whether DeMattia introduced Hamm to Donald Hinrichsen, a lending officer at Sun West Bank; whether Hamm paid DeMattia in return for his assistance in obtaining a loan from the bank and whether DeMattia in return paid Hinrichsen for approving the loan.

Hamm is also charged with perjury in connection with allegedly false statements he made to the grand jury denying that he had dealt with Hinrichsen.

An attorney for another witness called before the grand jury to testify about Sun West Bank loans said that up to $1 million in loans made by the bank are under investigation.

False Applications

The current indictment, however, is targeted only at false applications Hamm and his wife allegedly submitted and involves loans made by a variety of banks, including Sun West, Far Western Bank, First Arroyo Bank and Great Western Savings.

Hamm was elected to the Compton City Council in 1975, but resigned a year later after his conviction with another councilman on charges of extorting $40,000 from a business partnership that owned land in the city.

He was sentenced to three years in prison and a $10,000 fine.

Officials from the Los Angeles Organized Crime Strike Force, which conducted the latest investigation, said Hamm faces up to 18 years in prison and a $40,000 fine on the new charges. His wife faces 13 years’ imprisonment and a $30,000 fine.

Both were arrested Friday morning at the Westin St. Francis Hotel in San Francisco during the black publishers’ convention there and were brought before a federal magistrate.

Bail was set at $100,000 for Hamm and $25,000 for his wife.