April 29, 1977

US Dist Judge John M Manos, at Cleveland trial of Jack P Payner on charges that he made false statement in '72 income tax return when he denied having foreign bank acct, throws out evidence and testimony said to be based on illegal search made by IRS in Miami, Jan '73; IRS Project Haven and Operation Tradewinds, seeking evidence on illegal use of tax havens, photographed contents of briefcase belonging to H Michael Wolstencroft, manager-dir of Castle Bank and Trust Co (Nassau, Bahamas) while he was being entertained by female IRS agent; Govt contends Payner had over $100,000 in Castle Bank acct in '72; concedes IRS action with respect to Wolstencroft was illegal, but says evidence against Payner was obtained independently (M)

Massive swings in the Treasury's balance at Federal Reserve banks last week caused difficulty and uncertainty in the credit markets. Page D2.

The New York State Court of Appeals yesterday authorized the state to recover loans made to a man while he was a student at the State University campus at Albany, thereby opening a new legal avenue toward dealing with the growing and controversial practice by which young people avoid repaying college loans through declaring bankruptcy.

Chart of 1st-qr earnings of nation's 4 largest auto mfrs

Asst Sec Terence A Todman says he discussed antihijacking agreement with Cuban officials during recent visit to Havana; pact expired Apr 15; Todman por (S)