April 5, 1973

Equity Funding Corp of Amer, entangled in multimillion dollar scandal over bogus ins policies and besieged by bankers for immediate repayment of $50-million in loans, discloses Apr 4 it will petition Los Angeles US Dist Ct for reorgn under Fed bankruptcy law; lawyers tell Los Angeles Dist Ct Judge H Pregerson bd of dirs have approved bankruptcy action; Pregerson orders co to file after bankruptcy hearing from Calif Ins Dept, Calif Atty Gen and SEC reprs, Wells Fargo Bank lawyer and L B Merrifield, named by ct as special investigator; Equity Funding reptd earlier that it had been notified officially by bankers that loans were in default and that bankers planned to seize $10-million to $16-million in Equity Funding deposits to offset them; Pregerson restrains banks from proceeding against any of co's assets; growing insurance scandal is expected to trigger dozens of lawsuits, involve major brokerage cos, banks and other financial insts, raise charges of insider trading and, possibly, lead to massive criminal charges before full situation unfolds; other developments in case include: Ill Ins Dept opening of safe deposit box held by Equity Funding Life Ins at Amer Natl Bank & Trust, which was supposed to contain some $25-million of negotiable bonds and was reptdly empty; Los Angeles ins dept jurisdictional claim over Northern Life and Bankers Natl Life Ins co, another Equity subsidiary

SEC officials rept Apr 4 comm plans intensive inquiry into fraud charges brought against Equity Funding Corp of Amer; inquiry, in addition to probe of co's complex system of creating alleged spurious ins business and fictitious assets, will extend to insider information that may have induced inst investors and large brokerage cos to unload their Equity Funding shares on mkt before trading was suspended by SEC on March 28; knowledgeable enforcement officials are inclined for present to absolve ind auditing cos of any laxity or incompetence in connection with their examination of Equity Funding books; comm official indicates probability of criminal prosecution of those found responsible for alleged fraudulent sales and false reptg to SEC, stressing lasting damage done to securities indus, mkt and investors

Sen Watergate com Chmn Sen Ervin and Vice Chmn Sen H Baker say on Apr 4 that com has 'no evidence of any nature' implicating White House chief of staff H R Haldeman in any illegal' activities; say they are making announcement 'in interests of fairness and justice'; there have been repts that J W McCord Jr, in secret testimony before com last wk, charged Haldeman with advance knowledge of wiretapping at Dem Natl Com hq last June; Sen Weicker, who said on Apr 3 that Haldeman should accept over-all responsibility for improper Repub pol activity and submit his resignation, says on Apr 4 that he concurs with Ervin-Baker announcement; Watergate conspirators E R Martinez, B L Barker, F Sturgis and V R Gonzales are taken from Dist of Columbia jail and granted immunity from further prosecution by Judge Sirica; Barker and Martinez appear before grand jury on Apr 4 and their atty D Schultz tells reporters that both men answered all questions posed by 23-member panel; Sen Javits says it would be 'constructive' for Pres Nixon to inform public directly of what he knows about espionage plot; Haldeman illus

Secret World War II documents published by Vatican on Apr 4 prove that aides to Pope Pius XII--and probably Pope himself--knew of Nazi slaughter of millions of Jews; question of how much information Pope Pius possessed has long been debated in controversy over why he failed to speak out publicly against the slaughter; Abp A G Roncalli, who later became Pope John XXIII, reptd in '43 to Msgr G B Montini, now Pope Paul VI, referring to killings of Jews in Nazi-occupied Eastern Eur; Montini was then among closest aides to Pope; documents published by various official sources since end of World War II indicate that Pope Pius XII had recd repeated repts through diplomatic and other channels concerning mass killings of Jews in occupied Poland and deportations to death camps from Ger, France, the Netherlands and other countries; Pope Pius XII illus

L Oelsner series on NYC's juvenile justice system; discusses debate by Family Ct judges and others over what can be done to improve system; says most proposals for reforms call for diverting more children from justice system prior to ct action, attacking problems of juvenile misbehavior through preventive services for children and families in trouble, restructuring system so that there is more coordination between the units and more accountibility for what is done to children and rethinking theories and policies underlying system especially those allowing children to be jailed for conduct that an adult would not even have been arrested for; discusses 3 pending bill designed to bring about some reforms