Publisher Gets 4 Years in Fraud Case

A former Compton city councilman and recent president of the West Coast Black Publishers Assn., Hillard Hamm, was sentenced Friday to four years in prison for engineering a complex bank fraud scheme that netted him and his wife more than $250,000 in loans.

Hamm, 60, publisher of the Pasadena Gazette and Los Angeles Metropolitan Gazette, was also ordered to pay a $10,000 fine for constructing a series of fraudulent loan applications that federal prosecutors say allowed the Hamms “to lead an expensive life style, characterized by fraud, financed by other law-abiding citizens.”

Hamm’s wife, Beverly, was sentenced to six months in prison, 500 hours of community service and a $5,000 fine for her role in the conspiracy.

Prosecutors said the Hamms fraudulently obtained $252,000 in loans from Far Western Bank, SunWest Bank, First Arroyo Bank and Great Western Savings by constructing false income tax returns and sham employment reports under fictitious names to persuade bank officials that they could make good on the payments.

Hamm, who was convicted in 1975 on federal charges stemming from kickbacks he received as a City Council member, pleaded guilty in December to one count each of conspiracy, making a false statement on a loan application and lying to a federal grand jury. Beverly Hamm pleaded guilty at the same time to a conspiracy charge.

Elaborate Web of Deceit

In recommending a stiff sentence for the Hamms, federal prosecutors portrayed an elaborate web of deceit that enabled the couple--using the fictitious names of John and Brenda--to obtain loans from four Southern California banks with little collateral and modest income.

At least one of the loans was obtained through the mediation of a reputed organized crime figure, John DeMattia, who had paid bribes to a bank official at SunWest Bank in Newport Beach, according to prosecutor Ariadne J. Symons.

In connection with the $20,600 loan he obtained from the bank in 1984, Hamm wrote DeMattia a blank check, which DeMattia then endorsed and cashed, according to Symons’ sentencing memorandum. After the loan had been issued, DeMattia paid the loan officer $500 and said, “Here, John wants you to have this,” the report said.

Hamm has denied any links to organized crime. Beverly Hamm’s attorney, Alan Rubin, has said the Hamms and DeMattia simply used the same bank and loan broker.

“These people are dedicated to community service. Their whole career shows that. They have won numerous awards for their newspaper’s community service,” Rubin said. Hamm’s defense lawyer, Charles Johnson, also cited Hamm’s work on behalf of the National Assn. for the Advancement of Colored People in negotiating settlements of racial disputes.

“Yes, they committed a crime, and they admitted it and there’s no excuse for it. But to say these people are parasites on the community is absurd, in my mind,” Rubin said.

According to the government’s sentencing report, the couple often used employment verifications with inflated salary figures reported from their own newspaper publishing company to qualify for the loans,

When questioned about “John” Hamm by the grand jury, Hamm testified that John Hamm was his cousin, and he denied having told a Los Angeles detective earlier that John Hamm was his brother, according to the report.

He testified that John had taken over actively running the business after he had declared bankruptcy, but claimed that he knew nothing about his employment agreement with John or how much John was paid.