Word: sharpstown
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Dates: during 1971-1971
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...stock for a federal bank examiner who was checking Sharp's bank. The most serious charge that Wilson could not brush off was that he had paid for the installation of eavesdropping devices used against federal and state bank examiners investigating irregularities in the Sharp-controlled Sharpstown State Bank in 1967. While such bugging is not unlawful in Texas, it did break the security of an official investigation. Wilson insists that he did not know what...
...last week explaining his relationship with Sharp and denying any wrongdoing. But new information has come to light that could have more serious repercussions. TIME has learned that Wilson paid for the installation of eavesdropping devices used against federal and state bank examiners investigating irregularities in the Sharp-controlled Sharpstown State Bank...
...incident occurred in late 1967 when bank examiners were beginning to delve into Sharp's twisted financial affairs. The electronic bugs were concealed in offices used by the examiners poring over the Sharpstown State Bank's books. They were installed for a $2,500 fee by an electronics expert hired by Sharp. Wilson was then called by Joe Novotny, president of the bank, and told to pay the fee through his law firm. A memorandum Wilson wrote and initialed for his records on Nov. 6, 1967, detailed the transaction: "I received a telephone call from Joe Novotny...
According to the SEC complaint filed in federal court, the scheme became operative in July 1969. Houston's Sharpstown State Bank, like many others, was pinched for funds because of the ailing economy. Legislation desired by Sharp was introduced at a special session of the state legislature that could have given state-chartered banks and perhaps insurance companies tremendous advantages. The measures, actively supported by Governor Smith, would have allowed a state-chartered organization to assume the functions of the FDIC in Texas. The ceiling on insured deposits, then $15,000 under FDIC, would have been raised...
...however, that he has done nothing wrong. Joseph Novotny, former president of Sharp's bank, told investigators of getting a request from an intermediary to destroy the records of Smith's and Baum's transactions. Announcement of the SEC charges last month produced the run on Sharpstown State Bank that led to its closing down...