Money adviser arrested in Calif. Man charged with stealing $802,000 from Md. investors.

June 04, 1991|By Glenn Small | Glenn Small,Evening Sun Staff

George E. Fatt was one of the lucky ones.

He got most of his money back, but still ended up losing more than $42,000. Some lost as much as $369,000, others as little as $6,000. They all, according to the state attorney general's office, were clients of a Towson investment adviser named Michael E. Hart.

Hart, 34, was arrested in San Diego, Calif., last week on a fugitive warrant after a Baltimore County grand jury indicted him on charges of stealing more than $802,000 from eight customers.

He had apparently been living there since December, after having left Maryland with his wife and two children. Baltimore County police tracked down Hart after the family requested school records from the county.

Carolyn H. Henneman, an assistant attorney general, yesterday said Hart waived extradition and probably will be returned to Maryland this week.

Hart, who had been living with his family in San Diego under the name James Allison, was indicted May 20 on 29 counts of theft, tax evasion, fraudulent misappropriation of funds and securities fraud.

Fatt, a retired boilermaker from Eastpoint, said he had invested with Hart for five years without trouble and "he did pretty good for me."

Then, Fatt said, in 1989 he asked Hart to move $111,000 of his savings from one investment to another, which paid a higher interest rate. Hart said he would, but never mailed the final paperwork, Fatt said.

"This went on for months," Fatt recalled, until finally, "He came to my house and told me he didn't put it [the money] in the annuity. He put it in his bank and paid his bills with it."

"I told him he was going to jail like Jeffrey Levitt. I was pretty hot," Fatt remembered. Hart eventually promised to repay him and eventually did come up with $80,000 in two payments, Fatt said.

For the rest, Hart gave Fatt a deed of trust on Hart's house in Hunt Valley. But Fatt got nothing when the house was auctioned last year, because Hart still owed $160,000 on his mortgage, plus $50,000 for a second mortgage. Fatt also ended up having to pay a $9,000 income tax penalty because he failed to reinvest his money within 60 days.

"I put off vacations and scrimped to put money away for a good retirement," said Fatt, who also raised four children. "And here he's taking it away."

Raymond G. Florence, of Hamilton, said he lost $25,000 investing with Hart and doesn't expect ever to see it again.

"I'm glad they [made an arrest], but it won't do me much good, I'm afraid," said Florence, 72, a retired employee of Lever Brothers in Dundalk.

Henneman declined to say what the state believes Hart did with all of the money. But she did say that most of the alleged victims probably won't see their money again.

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.