Harford Co. gets $1.3 million from trustee in lawsuit

December 04, 1997|By Lisa Respers | Lisa Respers,SUN STAFF

The trustee in charge of a Pittsburgh-area fraud case has returned $1.3 million to Harford County in exchange for an agreement from the county to delay recovery of the rest its $4.8 million, a spokesman for the county executive said.

The money -- a portion of bond-sale assets the county invested through a Pittsburgh bank -- is part of about $345 million frozen by federal officials in a civil action against Pennsylvania investment adviser John G. Black.

"About one-quarter of the assets were released to us while they continue to do an assessment," said George Harrison, spokesman for Harford County Executive Eileen M. Rehrmann. "The agreement is that if we accepted the money, we would not immediately go after the rest while the investigation is continuing."

Harford County transferred $36 million during 1993 and 1994 to Mid-State Bank in Pennsylvania to be invested by Black's company, Devon Capital Management Inc. Harford officials said 90 percent of the money, used for capital construction, had been withdrawn for projects over the years.

Former Pennsylvania Gov. Richard L. Thornburgh has been appointed trustee of the assets while officials try to sort out accusations that Black mismanaged money belonging to about 100 clients, including Harford County and dozens of Pennsylvania municipalities and school systems.

"I think it's unreasonable to expect that they are going to receive 100 cents on the dollar," Thornburgh told The Sun in October.

Pub Date: 12/04/97

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