Surrender ends mystery

March 29, 1995|By Alec Matthew Klein | Alec Matthew Klein,Sun Staff Writer

Hamilton A. Schmidt, accused of theft and embezzlement in a scheme that left his company in ruins, lived out a quiet life in Arizona and Nevada hotels, working part-time and freely using his real identity while police searched for the former Towson insurance executive who vanished 18 months ago.

Just as easily as Mr. Schmidt abandoned his life on Sept. 14, 1993, he re-emerged, surrendering to Maryland state police on Monday. Even so, his sudden disappearance remains as much of a mystery as his unexpected return.

Associates and his employees at the time of his disappearance were stunned that a man known for his integrity and dedication to his company would vanish, leaving behind little but two emotionally rife farewell letters.

"I can't get into all that," said his attorney, Steven A. Allen, of Weiner, Astrachan, Gunst, Hillman & Allen, when asked about Mr. Schmidt's return. "A lot of businessmen whose businesses go down the tubes -- some go off and buy a ranch, and some guys go off and move. It wasn't like he went for a pack of cigarettes and didn't come back."

Indeed, Mr. Schmidt held what were described as odd jobs, moving from place to place, sources said. For his return, he only brought back clothing. Divorced before his disappearance, he remains single.

The former chief executive officer of Charter Group Inc., once one of the region's largest independent insurance agencies, did not know until last Wednesday that he was a fugitive, his attorney said.

Mr. Schmidt was indicted in October 1994 on charges of stealing more than $200,000 from the company and its employees' stock ownership plan and misusing more than $600,000 from insurance companies and policyholders.

"Immediately after he learned about the criminal charges pending against him in Maryland, he contacted me," Mr. Allen said. "I contacted the attorney general's office Thursday morning and arranged for his self-surrender."

Mr. Allen would not say how Mr. Schmidt discovered he was a wanted man. Nor would he disclose what Mr. Schmidt had been doing for the past 18 months, other than confirming that he had lived briefly in Las Vegas.

"He's not been living as a fugitive," Mr. Allen said. "He's been living under his whole name the whole time. . . . For the last 18

months, he's been living as Hamilton Schmidt, not using an alias. . . He was living lawfully, earning a living doing things."

At 11 a.m. Monday, a 40-year-old Mr. Schmidt -- looking healthy and with no discernible changes in his appearance -- strode into the attorney general's office, wearing blue slacks, a crew-neck sweater and a button-down shirt. One participant at the encounter said, "He looked like a guy you might be sitting next to in the movies."

The former executive simply opened the conversation by saying, "Hi, I'm Hamilton Schmidt," greeting Assistant Attorneys General Norman L. Smith and Michael DiPietro and state Trooper Jason Merson.

After pleasantries were exchanged, Mr. Schmidt was taken to Baltimore County for fingerprinting, a mug shot and paperwork, and then to District Court. Mr. Schmidt posted bail with real estate holdings assessed at over $130,000, $50,000 in cash and $20,000 in corporate bonds. The assets came from family members, sources said. Arraignment and trial have yet to be set.

Mr. Schmidt could face 105 years in prison on two counts of felony theft and 15 counts of embezzlement, or fraudulent misappropriation by a fiduciary. He has not been charged with flight, although authorities seemed less than confident that he would not suddenly disappear again.

"Mr. Schmidt will enter a plea of not guilty and intends to contest the charges," his attorney said.

State Attorney General J. Joseph Curran Jr. suggested yesterday that Mr. Schmidt's sudden reappearance could be attributed to recent efforts by state police to step up their investigation. "The extra pressure from the state police may very well have driven him to surrender," Mr. Curran said in a prepared statement.

The attorney general's office would not elaborate, but a source close to Mr. Schmidt said, "They were no closer to finding him yesterday than they were three months ago."

There was little for authorities to go on but his company's finances and a letter he sent to Charter on the day he vanished, saying, "I feel my mental and physical health is in jeopardy."

Mr. Schmidt's fall was all the more stunning because he had joined the firm in 1976, quickly establishing himself as a top insurance agent. By 1990, he became president, CEO and chairman of Charter, by then one of the 100 largest independent insurance agencies in the nation.

Mr. Schmidt was last seen at 12:45 p.m. on Sept. 14, 1993, when he was dropped off at Pennsylvania Station by an employee of Chesapeake Cadillac-Jaguar, where he had taken his 1992 Cadillac DeVille for repairs.

Only he knew then that his company was in a financial tailspin. Later, the state attorney general's office and the Maryland Insurance Administration went through the company's books, Charter's insurance business was sold and the firm filed for bankruptcy protection.

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