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Stock broker faces mail fraud charge

September 09, 1999|By SCOTT BUTKI

A former Hagerstown stockbroker has been charged with embezzling more than $700,000 from clients, the U.S. Department of Justice said Thursday.

William S. Hatcher Sr. was charged in a one-count criminal information with mail fraud, Assistant U.S. Attorney Dale Kelberman said Thursday. The charge was filed in U.S. District Court in Baltimore.

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Hatcher was not taken into custody, Kelberman said.

Hatcher, 40, worked for Ferris, Baker, Watts, Inc., in Hagerstown for 15 years. The company cooperated with the investigation, which was conducted by the Maryland office of the Federal Bureau of Investigation, according to the Justice Department.

The charge alleges that while he was a broker with the Hagerstown office of Ferris, Baker, Watts, Hatcher misappropriated clients' funds from January 1991 through April 1998 by liquidating some of their securities and converting the proceeds to his own use, Kelberman said.

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The charge alleges that he had clients' financial statements sent to a post office box he used so the clients would not know something was awry, Kelberman said.

Hatcher also allegedly used his own money to send clients what they thought were dividend payments, he said.

Hatcher resigned from the company in December 1998.

Hatcher did not return phone messages left on an answering machine at his home.

"This is an unfortunate series of events for all of those involved. We will continue to cooperate fully with the Federal Bureau of Investigation and the U.S. Attorney's Office," said Ferris, Baker, Watts Branch Manager John Hershey III.

"Our clients can be assured that we have done a thorough review of accounts and that this action was limited to a small number of Mr. Hatcher's accounts. No other broker's accounts were affected," Hershey said.

Hatcher had worked for the company for 15 years, was familiar with its procedures and was able to make sure his actions went unnoticed, Theodore Urban, general counsel for Ferris, Baker, Watts, alleged.

Urban said one of the clients was a family member of Hatcher's but he would not state the relationship.

Kelberman would not say how many clients were involved and whether any of their money had been returned.

A conviction on one count of mail fraud carries a maximum penalty of five years in prison and a $250,000 fine, plus restitution.

No date has been set for Hatcher's initial appearance and arraignment.

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