Democrat and Chronicle from Rochester, New York • Page 11

DEMOCRAT AND CHRONICLE, ROCHESTER, N.Y.. THURSDAY, AUGUST 15. 1985 3D Bank raps brokerage house on Termotto stock By Kinsey Wilson DID YOU OWN PROPERTY IN ROCHESTER, N.Y. BETWEEN 1974 AND 1978? The New York Courts have said that the City of Rochester, N.Y., collected too much property tax for the period 7174 to 63078. A class action lawsuit has been filed to determine who is eligible for tax refunds.

If you paid property taxes to the City of Rochester during those years, you MAY be eligible for a tax refund. To determine your eligibility you MUST obtain a CLAIM FORM and send it back no later than November 11, 1985 To obtain a CLAIM FORM or for further information call (716) 232-6430 or mail the coupon below to: Property Tax Refund Program P.O. Box 41975 Rochester, N.Y., 14604-4975 ker, Nathan, Lewis Grant, through which the purchase was made. "Josephthal is shielding Nathan, Lewis from liability in this case," Graschadl said. To turn the proceeds over to Josephthal, he said, "would simply be continuing the fraud that was committed against the banks." Groschadl told the court he believes "strongly that Nathan, Lewis was part of the fraud that was committed against the banks." He then posed a series of question that went unanswered by Josephthal's lawyers.

Among the issues still unresolved, Groschadl said, were: Who actually paid for the stock? When did Josephthal first learn that Termotto's check had bounced? Groschadl said he had reason to believe it may have been as early as February. Did someone cover up the bounced check to give Termotto time to obtain the loans from the Rochester banks? What was the nature of the business agreement between Josephthal and Nathan, Lewis Grant? Why wasn't Josephthal reimbursed for the bad check by Nathan, Lewis? Did Nathan, Lewis ever have possession of the stock? Central Trust and four other banks have filed separate lawsuits against Termotto, Nathan, Lewis and two employees of the firm, charging that they defrauded the banks of loans totalling more than $600,000. One of the banks, Chase Lincoln, is seeking $1 million in punitive damages. The banks have agreed to divide the proceeds from the sale of the stock if they get court approval. But that sum will cover less than a third of the value of the outstanding loans.

Termotto, meanwhile, is free on $50,000 bail on criminal charges involving the loans he obtained from banks and private individuals. In the criminal cases, Monroe County prosecutors said Termotto obtained the loans to finance the opening of an art gallery in the historic Powers Building in downtown Rochester and to cover previous personal debts. Lawyers for Josephthal, a firm that handles stock transactions for other brokers, argued yesterday that they were entitled to the money because Termotto never paid for the stock. Alan Raylesberg, Josephthal's lawyer, explained that Termotto had paid nearly $200,000 for the stock with a personal check that bounced. The check was written to another brokerage house and then endorsed over to Josephthal.

Raylesberg argued that the stocks in effect were stolen from Josephthal. Although the stock was purchased early in the year, Josephthal claims it did not learn Termot-to's check had bounced until after Central Trust obtained the certificates in April. Central Trust's lawyer, Paul S. Groschadl, argued that Josephthal by failing to demand a certified check or some form of collateral had sold the stock to Termotto on credit. i Central Trust, as a secured creditor, has a legal right to the money that outweighs Josephthal's unsecured claim, he said.

Groschadl went on to charge that Josephthal the company that acquired the actual stock certificates appeared to be protecting Termotto's personal bro Democrat and Chronicle A lawyer for Central Trust Co. yesterday charged that a New York City brokerage house was protecting another broker accused of having helped Thomas A. Termotto defraud local banks of more than $600,000. The allegation surfaced in state Supreme Court, where lawyers for i Central Trust and Josephthal Co. Inc.

made competing claims for stock certificates Termotto used to obtain numerous bank loans. State Supreme Court Justice Eugene W. Bergin declined to make an immediate ruling, and the case is expected to go to trial at a later date. At issue are stock certificates Termotto pledged as collateral to obtain loans in late 1984 and early 1985 from Central Trust, Marine Midland Bank, Manufacturers Hanover, Chase Lincoln First Bank and Key Bank. Central Trust obtained the stock certificates under a court order in April shortly after learning Termotto had left the country and defaulted on the loans.

The stock was sold for about' i $185,000, and Central Trust is holding the money pending the outcome of the court proceedings. REQUEST FOR CLAIM FORM PLEASE PRINT Last Middle First Street City State Zip Country ROCHESTER NY TAX REFUND PROGRAM Maloney bail hearing adjourned extradition order. He was picked up by Irish police Jan. 7. Maloney had been under surveillance for 11 years, but he could not be brought back to the United States for trial because Ireland did not have an extradition treaty with the United States.

Maloney was arrested after a new treaty took effect Dec. 15. He has been held in a Dublin prison pending extradition. Rochester law enforcement officials have asked that bail be A bail hearing in Dublin, Ireland, yesterday for Michael Maloney, who is fighting extradition to face murder charges in Rochester, was adjourned until Aug. 30, Irish Justice Department spokesman Brian Merriman said.

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