A Hush-Hush Deal

Among fashionable jewelry firms, none is more discreet than Manhattan's Van Cleef & Arpels. The firm's customers and what they buy are private matters. But four months ago, the firm complained publicly about a customer in a way that shook cafe society and Hollywood; it had received a worthless check from Playboy Robert Schlesinger (TIME, Feb. 21), whose mother is Countess Mona Bismarck, remarried widow of Utilities Tycoon Harrison Williams, and whose father is Henry J. Schlesinger, retired Milwaukee industrialist. Said Van Cleef & Arpels : Schlesinger had given Cinemactress Linda Christian, estranged wife of Cinemactor Tyrone Power, jewels worth $132,500, made partial payment with a $100,000 check that bounced. Unable to collect from Schlesinger, Van Cleef slapped a suit on Linda in an effort to get back the jewels.

Last week it was Wall Street's turn to be shocked when it heard the methods Schlesinger used to try and raise the money to pay his bills. As he announced an eight-count indictment against Schlesinger, Manhattan District Attorney Frank Hogan charged that Schlesinger had used his mother's name and the reputation of his employers, the investment banking firm of Glore, Forgan & Co., to swindle three prominent businessmen in an oil scheme. The victims: brothers Richard and John Herzfeld, who were part owners of Milwaukee's Boston Store until it sold out to the Federated Department Stores chain (TIME, Dec. 20, 1948), and Robert P. McCulloch. former Milwaukeean who is now president of McCulloch Motors, which grosses $40 million a year making power saws, superchargers and plane parts.

New Business. Schlesinger, whose job was to drum up new business for Glore, Forgan, first presented his scheme to Raymond Newman, a financial adviser for the Herzfeld brothers and McCulloch. during a visit to Milwaukee to see his father (his mother renounced all claims to the custody of her son when she divorced his father in 1920, and a trust of upwards of $300,000 was set up and later turned over to the lad). Schlesinger said that his mother had put $500,000 in a "hush-hush" Louisiana oilfield. As recounted in the indictment, he said that "Mrs. Harrison Williams had authorized him to sell a 10% interest in the Louisiana Oil Syndicate [through Glore, Forgan] to afford Glore, Forgan an opportunity to make a commission [and] solidify his position with Glore, Forgan . . ." On Dec. 23, 1953, impressed by the big names Schlesinger was throwing around, McCulloch gave him a check for $20,000. Later, by telling them that an aunt had died and another 10% interest was available, Schlesinger got each of the Herzfelds to give him a $10,000 check. On May 17, 1954 McCulloch put up another $40,000; a few days later Schlesinger hit the Herzfelds for an additional $20,000 each, and on Oct. 13 McCulloch increased his interest in the "syndicate" with a $60,000 check.

Beginning of the End. Then, for another $150,000. Schlesinger offered to sell half interest in an option he claimed his mother held on another Louisiana oilfield. McCulloch was more cautious this time. He told Schlesinger that he wanted Mrs. Williams' financial adviser, Paul Preger, to confirm an agreement whereby Mrs. Williams would indemnify McCulloch if the deal fell through. Schlesinger. who was vacationing in Mexico, flew to Dallas, spoke to McCulloch's confidential aide, Joseph Hegener, on the phone, pretending he was Preger, confirmed the deal and sent a wire signed "Preger.''

McCulloch sent along his check for $150,000, part of which Schlesinger turned over to Van Cleef & Arpels. Then Hegener, trying to recheck some details with Preger, reached him at a St. Louis hotel, found that he had not been in Dallas and listened in horror while the real Preger told him that Mrs. Williams had no interest in the oil properties. McCulloch stopped payment on the check. Thus, when Van Cleef & Arpels tried to deposit Schlesinger's check, it bounced --and Hogan's office started to investigate. At week's end Hogan was still looking for Schlesinger, who was reported to be in South America.

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