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Banker links Sharp, Mutscher
ABILENE, Tex. (^) — The
former president of Frank
Sharp’s bank testified Thursday
the Houston promoter personally
ordered $220,000 in loans for
House Speaker Gus Mutscher
id two associates.
Speaking softly and almost
casually, Joseph P. Novotny
said they were nonsecured loans
issued in July 1969 on the
strength of the trio’s financial
statements.
He said certificates of stock
which the defendants purchased
with the loans later were re
ceived at the Sharpstown State
Bank. He did not say the bank
held the stock as collateral
against the loans.
And for the first time in the
presence of the jury, the names
of Gov. Preston Smith and for
mer state Democratic Party
Chairman Elmer Baum were
listed among the political fig
ures in the bank-stock deals.
Novotny was the final prose
cution witness Thursday in the
bribery-conspiracy trial of Mut
scher, his aide Rush McGinty
and state Rep. Tommy Shannon
of Fort Worth.
The three are accused of con
spiring in 1969 to accept a bribe
from Sharp in return for their
influence in propelling two bank
ing bills through the legislature.
The state alleges the defend
ants obtained the loans from the
Sharpstown bank to purchase
stock in National Banker’s Life
Insurance Co. of Dallas.
Sharp controlled both the bank
and the insurance company, and
the deals enabled Mutscher and
his colleagues to reap quick prof
its. The defense contends it was
a routine business transaction.
Novotny testified that his loan
authority at Sharpstown was
fixed at $10,000 and that any
loan in excess of that had to have
Sharp’s personal approval.
An executive loan committee
at the bank “actually had no
function,” Novotony testified.
Novotony spoke at great length
of Sharp’s free-wheeling busi
ness activities and said at one
point, “Mr. Sharp may be in
genious in many areas but in
banking he doesn’t know the dif
ference between an overdraft
and a cashier.”
Novotony, a stylish, a person
able figure, is under federal in
dictment himself on charges of
misapplication of bank funds
and making a loan to a bank exn
aminer.
District Court Judge J. Neil
Daniel instructed the defense not
to mention Novo tony’s indict
ments in front of the jury.
Novotony, testifying from
Sharpstown bank records, said
Mutscher listed his net worth at
$331,700 when he applied for a
$130,000 loan.
McGinty set his net worth at
$272,000 and Shannon at $123,-
939 in obtaining loans of $46,000
each.
In all three cases, the net
worth figures exceeded those
which appeared in earlier testi
mony concerning the purchase of
National Bankers Life stock.
Novotny testified the finan
cial statements were defective in
one critical area in that they con
tained no appraisals of real
estate and other assets.
He said, however, the loans
conceivably would be good loans
if the value of the assets could
be established.
It was during a discussion be
tween defense lawyer Frank Ma
loney of Austin and Novotny that
Smith and Baum were first men
tioned. Maloney listed them as
“two added people” who sold 14,-
000 shares of NBL stock the same
day as the three defendants.
“That’s the loans to Preston
Smith and Elmer Baum,” No
votny replied.
His testimony showed that
Smith and Baum sold a portion
of their stock holdings on Sept.
11, 1969, two days after the con
troversial banking bills passed,
for a total of $280,000.
Smith said previously he and
Baum split a $125,000 profit on
their NBL investment.
The prosecutor Smith said ear
lier outside the presence of the
jury that the evidence in this
case will make it clear that
Smith was a co-conspirator in
this case.
A prosecution lawyer asked
Novotny, “Did you ever have any
instruction to hold the stock on
collateral ?”
“Not that I recall,” Novotny
replied.
The tall, thin banker testified
the deposit-loan ratio kept the
(See Mutscher, page 2)
he Bdttalio
College Station, Texas
Partly
cloudy,
mild
Friday — Partly cloudy. South
erly winds 10-15 mph. High 73°,
low 56°.
Saturday —. Partly cloudy to
cloudy. Southerly winds 15-20
mph. High 78°, low 58°.
Friday, March 10, 1972
845-2226
ork
Nixon orders tighter security
/>* to block airline bomb hoaxes
By THE ASSOCIATED PRESS
President Nixon has ordered
the nation’s airlines, hit by a
spate of bomb hoaxes, to imple
ment tighter security controls in
the tense aftermath of a $2-mil-
lion extortion plot against Trans
World Airlines.
The airlines already had re
acted to the plot with taut se
curity procedures and experi
enced numerous delays as a re
sult. There were forced landings
Agnew planning to visit
several college campuses
CORPS COMMANDANT Col. Thomas Parson’s talks with Faye Spain, one of 60 mem
bers of the Houston Mothers Club who visited parts of the campus Thursday. The group,
which could be seen riding around campus in a bus, were shown the university by mem
bers of the administration and students. (Photo by Mike Rice)
WASHINGTON (^) — Vice
President Spiro T. Agnew an
nounced Tuesday night he will
visit several college campuses in
the coming months to present
American students with the Nixon
administration’s point of view and
find out what is on the young
people’s mind.
The round of campus appear
ances, which will correspond with
the heavy primary election sched
ule, will begin next Wednesday
when Agnew speaks at Drake
University in Des Moines.
Agnew announced the plan to
a gathering of approximately
1,400 Young Republicans who
made a highly vocal show of sup
port for the vice president.
“I expect to go with an open
mind,” Agnew said. “I won’t
Come back with the same opinions
I went with.” He said he hopes
his audiences give him a similiar-
ly open-minded reception.
Irving and wife indicted
Easterwood airport build-up
includes new landing system
for forging Hughes book
NEW YORK (A>) _ Clifford
Irving and his wife Edith were
indicted by federal and county
grand juries Thursday on charges
of fabricating taped interviews,
forging documents and engaging
in other schemes in a plot to
obtain $750,000 for a bogus auto
biography of billionaire Howard
Hughes.
The indictments spelled out in
minute detail how the Irvings
and their researcher, Richard
Suskind, carried out the alleged
hoax which duped two major
publishers.
Irving and Suskind are ac
cused of taking turns playing
Hughes in simulated interviews
to McGraw Hill, Inc., as tapes of
unprecedented conversations with
the eccentric recluse.
The 24-page indictment
charged the Irvings with mail
fraud and conspiracy. It named
Suskind as co-conspirator but not
a defendant.
The county grand jury charged
the Irvings and Suskind with
grand larceny, conspiracy and
possession of forged documents.
In addition, Irving and Suskind
were charged with perjury —
Irving for swearing he had met
with Hughes in such places as
California, Mexico and Florida
and Suskind for saying in an
affidavit he was present at such
grown prune.”
Dist. Atty. Frank S. Hogan
said the 25-count county indict
ment alleges the Irvings and
Suskind thought they could “suc
cessfully defraud McGraw-Hill
based upon their belief that
Hughes was either deceased or
not of sufficient mental or physi
cal capacity to denounce the
autobiography as a fake.”
The three were arraigned on
the federal charges before Judge
John Cannella who set next Mon
day for pleading after Irving’s
lawyer, Maurice Nessen, asked
for “an all-purpose adjourn
ment.”
Improvements underway a t
Easterwood Field include resur
facing the main runway, installa
tion of an instrument approach
system and a new hanger, said
Airport Manager Truett Smith.
The major project involves
leveling and surfacing the main
5,150 foot north-south runway.
This will include clearing land
at the ends and the construction
of an overrun escape area. This
phase of the developments will
cost about $600,000.
The Federal Aeronautics Ad
ministration is installing an in
strument landing and approach
system built by a Denver firm.
Part of the system will be equip
ment to electronically guide air
planes in bad weather. The other
part is special lighting on the
runways to make them more vis-
able in bad weather.
Other construction includes a
nine-inch thick cement parking
area near the terminal for heavy
aircraft use. The present park
ing and taxiing area near the
hanger will also be converted
from blacktop to cement. These
will be completed in about 90
days, Smith said.
The new hanger will be built
north of the present one. “The
hanger will be used for storage
and maintenance of the three uni
versity-owned aircraft at the
field,” commented Smith. The
work is being done by Central
Construction of Bryan.
“We presently have 70,000 to
80,000 take-offs and landings
yearly, said Smith. “We expect
the new, improved facilities to
greatly increase this.”
and other delays because of bomb
threats throughout the day.
Nixon ordered on Thursday
“immediate steps by every car
rier to prevent or deter weap
ons or explosives from being
carried aboard its aircraft; to
prevent or deter unauthorized
access to its aircraft; to tighten
its baggage checking procedures,
and to improve the security of
its cargo and baggage loading
operations.”
At least two airborne planes
had to land after bomb threats
were received. On the ground,
planes were searched repeatedly,
and some were kept under guard
in the glare of floodlights.
The discovery Tuesday of a
bomb in the cockpit of a TWA
plane in New York City plus the
explosion the following morning
that blew apart the cockpit of a
TWA craft in Las Vegas spawned
the hoaxes and spread anxiety
among airline officials and pas
sengers alike.
There was no confirmation of
published reports that TWA was
negotiating with an extortionist
but had lost contact with him.
TWA officials denied a New
York Police Department report
that a plane carrying $2 million
was sent to Atlanta, Ga., ort
Tuesday night but that no money
was turned over to the extor
tionists.
On Thursday, bomb scares de
layed flights of planes operated
by Eastern, Western, American
and Delta Airlines.
Arrivals at Kennedy Airport
were from 20 minutes to 2%
hours late. At Chicago’s O’Hare,
departure delays averaged 15
minutes. At Columbus, Ohio, se
curity measures caused flight de
lays of up to 30 minutes.
A spokesman for the Federal
Aviation Agency said at least a
dozen unfounded bomb threats
had been made to airline offices
and FAA facilities in Kansas
City in two days.
Security took various forms.
In Cleveland, Ohio, off-duty
policemen stood guard over
parked jetliners that were flood
lighted overnight. An increased
number of city policemen were
posted at the airport in Phila
delphia. In Columbus, Ohio, only
passengers were allowed beyond
the terminal lobby.
Meanwhile, the International
Air Transport Association warn
ed airlines to be wary of a new
extortion attempt.
Two vessels disappear;
search underway in Gulf
CORPUS CHRISTI, TEX. (AP)-Nine Coast Guard and Air
Force aircraft plus Coast Guard cutters raked the Gulf of Mexico
Thursday for two missing vessels.
One missing ship is the 522-feet motor-tanker San Nicolas,
which is being sought between the Yucatan Peninsula of Mexico
and New Orleans, where she has been overdue since Monday
night. The tanker was bringing a cargo of molasses from Brazil.
The second search, off the northwest coast of Florida, is for
the 36-foot cabin cruiser Wahoo of Dunedin, Fla., which left
Texacola Feb. 27 with one man aboard and was due at Dunedin
March 5.
of the billionaire, recording their
answers and later offering these
a meeting in California where
Hughes gave him “an organically
iVew carpet color choices
submitted to resident halls
Simon commends TV’s information role
Each floor of Corps and Sbisa
area dormitories will choose from
among gold, blue, green and ash
brown for its hall and ramp
carpet colors.
Resident halls have until March
18 to decide their colors. Stu
dents with a preference should
contact their floor resident ad-t
visors or dorm representatives.
Carpeting will begin this sum
mer and is due to be completed
for the fall semester.
A student committee met Wed
nesday afternoon to select carpet
colors. Members of the carpet
selection committee appointed by
Student Senate President John
Sharp were Randy Ross, Randy
Richards, Jim Gleason, Jim Wil
son, Donald Corsale, Steve Mill
er, Joe Horlen, Terry Clark, Steve
Wakefield and Jack Lopez repre
senting Sbisa area halls. Jerry
Elmer, Andy Brosh, Dan New-
some, Joe Aston and Jerry Camp
bell represented Corps area
housing.
Halls receiving carpeting will,
in addition, have 52 water foun
tains installed, one for each hall
floor or ramp. Shower and rest
room glass in corridor type dorm
itories will be replaced with ob
scure glass.
This summer’s work will in
clude a complete rewiring of
Law and Puryear Halls to pro
vide power to meet current elec
trical convenience needs. A pow
er extension to Duncan area
University National Bank
"On the side of Texas A&M.”
—Adv.
halls will provide needed power
for additional electrical conveni
ences such as more refrigerators
and televisions. Additional elec
trical work for other deficient
dormitories is scheduled to be
completed in 1973.
Exterior doors in the Duncan
area will be replaced and a
cushion seal to reduce noise from
outside activities will be added
to room doors in 21 halls. Re
pair and refurnishing of several
lounges and selected refurbish
ing are also included among this
year’s renovations.
With a small amount of input television is able to
command millions of man hours for the dissemination of
information, said Dr. Herbert Simon Thursday.
Simon, speaking in the University Lecture Series, said
television is the most spectacular information outlet for
mankind. Referring to President Nixon’s recent visit to
China, he compared television viewing to traveling.
The one consolation to watching television to gather
information is that it is inexpensive to man, he said.
Simon said the law of conservation of energy can not
be compared with attempts to prove a law of the conser
vation of information.
“We have an information explosion because previous
information has allowed us to expand our knowledge,” he
said. “Information began to explode with the invention of
the printing press which resulted in the dispersion and
diffusion of information.” -
Since no law of conservation of information exists, he
said, there is one of attention. With only so much attention
to go around, Simon said the ordinary human has only 16
hours in 24 to train attention on a particular purpose.
“We are learning to describe man and computers as
information processors,” Simon said. “Many human condi
tions are understandable if man is considered to have a dual
role in processing information.
“Man’s memory enables him to store and call up
information. There is no evidence that the memory fills up,
as we have discovered working with sophomore college
students. Access to this memory presents a problem to many,
but access can be predicted.”
Simon said men and computers act as serial systems
for processing information. They are serial systems because
they can do only one thing at a time, except men can pulsate
and breath while doing something else.
“Activities which regulate attention occur one at a
time,” he said. “Multiple things can happen at the approxi
mate same time by time sharing. A dangerous example of this
is talking while driving.”
Simon then questioned the consequences of the
explosion of information.
“The explosion doesn’t have any consequences if the
information can be ignored,” he said. “On the other hand if
we have to attend to the information increase, we do it
because it’s there or because it is essential for solving
problems.”
Historically, the best memory source has been the
mind with its associative organization. Simon exemplified
this by saying the telephone is the linking device in our
system for 200 million minds to tap each other for stored
information.
Simon listed four strategies for man to cope with
limited attention, the first being to construct selected filters.
These would be review articles and clipping services to
transfer information relevant to a particular group of people
he said.
Simon also said man should build information com
pressors to allow information to be stored, set priorities for
attention distribution and be cautious about the way new
information processors are brought into the world.
Through correct management of information dissemi
nation, he said, the output from the source should be better
than the original input of information. Universities are
becoming more important in their relavence because credible
information is being produced for intelligent decisions.
Simon said an example of mismanagement of pro
cessed information is the statement by Congress that it is
impossible to stop pollution by autos by 1975 but health is
important so “we’ll pass the bill anyway.”
Simon closed saying it is hypocrisy to believe there is
too much information for man to take in. “If there was we
would manage our time differently,” he said.
Dr. Herbert Simon