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Most of the suspicious checks carried Hodge's facsimile signature; many had apparently been cashed fraudulently; e.g., Springfield Businessman Clarence J. Reuter pointed out that a $10,385 auditor's check supposedly signed by him was incorrectly endorsed "J. C. Reuter." Moreover, said George P. Coutrakon, state's attorney for Sangamon County (county seat: Springfield), many of the checks in question had been cashed in "suspicious circumstances" at Chicago's Southmoor Bank & Trust Co., which, as a state bank, was under Auditor Hodge's jurisdiction.
Interior Decorators. The Southmoor Bank, Reporter Thiem disclosed, held a $24,000, low-interest (35%) mortgage on Hodge's $25,000 lakefront Springfield home. The News also reported that some $450,000 in checks from Hodge's office had been paid in two years to Fabric-Craft Sales Corp., a one-room Chicago interior decorating service headed by Mystery Man William Lydon, a policeman who was once indicted (and later acquitted) in the murder of a Chicago madam. Fabric-Craft and two other companies headed by Lydon listed two Hodge aides as officers: Chief Personnel Officer Lloyd Lane and Administrative Assistant Edward A. Epping. Epping, half owner of an accounting firm retained by the auditor's office, was accused by a Southmoor Bank attorney of cashing $240,000 worth of suspicious checks.
Last week the FBI, T-men and state budgetary commission agents were all investigating Hodge's office. At week's end Edward A. Hintz, who was ordered to appear this week before grand juries in Chicago and Springfield, resigned as president of the Southmoor Bank. Altogether, said authorities, the phony checks may cost the state as much as $1,000,000.