After heat was turned up, so did missing executive

April 01, 1995|By Alec Matthew Klein | Alec Matthew Klein,Sun Staff Writer

They were out of options. For six months, investigators could not find a trace of Hamilton A. Schmidt. So they put the squeeze on.

Under the glare of a bright March afternoon, state troopers Jason Merson and Patrick Jameson stepped out of an unmarked Chevy. In plain clothes, they were about to make some unannounced visits.

Susan Schlegel was reading a book in a lounge chair in her backyard when the two men approached, flashed their badges and explained what they wanted: information about her brother, Mr. Schmidt, a former Towson insurance executive who vanished 18 months ago and remained at large after he was charged with theft and embezzlement last October.

"I find it hard to believe you don't know where he's at," Trooper Merson told her. "It'd be best if he turned himself in."

To the investigators' surprise, Ms. Schlegel referred them to her attorney. A day later, so did Mr. Schmidt's mother. Yet neither woman was under investigation.

"There wasn't really a whole lot to go on," Trooper Merson said. "Of course, your instincts tell you something's not right."

Eight days later, Mr. Schmidt surfaced and, through his attorney, agreed to come in. On Monday, he surrendered to authorities, and -- with help from relatives -- put up real estate, securities, and cash to remain free on bond.

"Purely a coincidence," Mr. Schmidt's attorney said of the

sequence of events. Steven A. Allen said his client placed a call to a family member on Wednesday, March 22, learned he had been indicted and immediately arranged to come home.

"Of course, they're saying it's a coincidence," Trooper Merson said. "We may never know what really happened.

When Mr. Schmidt entered Penn Station 18 months ago, he alone knew he would not return and that he had left his company, Charter Group Inc., in financial ruin.

A year later, he was indicted, and state police launched an investigation into his whereabouts.

Mr. Schmidt is charged with stealing more than $200,000 from his company and its employee stock ownership plan, and misusing more than $600,000 from insurers and policyholders.

For six months, however, police could not arrest him because they could not find him, even though sources say he was living in hotels under his own name in Arizona and Nevada, including Las Vegas.

But a credit card check turned up nothing. So did a nationwide computer bulletin to alert authorities of a warrant for his arrest. Police had subpoenaed Mr. Schmidt's mother's telephone records and searched his sister's house, where he once lived. Again, they drew a blank.

There was one card left to play -- questioning Mr. Schmidt's family. But Trooper Merson considered it only a last resort.

"We didn't want them, if they did have contact with him, to tip him off," he said.

Finally, Trooper Merson decided there was no choice.

Ms. Schlegel seemed shaken when she saw the two state troopers on March 14, Trooper Merson said. But Mr. Schmidt's sister invited them inside through her back basement door into a clubroom. Trooper Merson didn't dance around the question: "Do you know where he is?"

She said no.

"Have you heard from him?"

No, she said, except several months ago when he called to say, "Tell Mom I'm OK."

Trooper Merson wasn't convinced, and he said so, stressing that Mr. Schmidt should turn himself in. Ms. Schlegel said she had an attorney and would not talk without him present.

The next morning, March 15, Troopers Merson and Jameson knocked on the door of Florence Odell Hack, Mr. Schmidt's mother. She came to the door, opened it about a foot and asked to get a better look at the officers' badges.

Ms. Hack was not surprised by their visit; she had already heard from her daughter.

"Could we come in?" Trooper Jameson asked.

She declined, then informed them that she was represented by an attorney.

Again, the officers said it would be better for Mr. Schmidt to turn himself in, and they left.

Eight days later -- March 23 -- Trooper Merson was submerged in paperwork at his desk in downtown Baltimore, where he works in the Criminal Investigations Division of the state attorney

general's office. An investigative accountant dropped in to tell him that "Norman wants to see you."

Assistant Attorney General Norman L. Smith was standing at the other end of the hall, smiling.

"I just got off the phone with Mr. Allen," Mr. Smith said. "And Hamilton will turn himself in Monday."

"I couldn't believe it," Trooper Merson said. "Just by coincidence, just a day or so after talking with his mother and sister, he called."

Mr. Schmidt, however, could not turn himself in, at least not right away. He did not have enough money to pay for a plane ticket, sources said. In the past 18 months, he had held down only odd jobs.

On the advice of his attorney, Mr. Schmidt declined to comment on his abrupt departure, his sudden return and what he did while away. Mr. Schmidt, staying at his mother's home in Baltimore, faces up to 105 years in prison, if convicted; creditors are suing him for more than $1 million; and Charter Group no longer exists.

What few assets remain are being contested in U.S. Bankruptcy Court. Mr. Schmidt has a $3.9 million life insurance policy, but his creditors are the beneficiary. In his absence, they continued to pay the insurance premiums. Their attorney, James A. Vidmar, Jr., said, "We didn't know if he was dead or alive."

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