YOUNGSTOWN Resignation puts charitable trust in bind

The trust makes donations to educational and nonprofit organizations and hospitals in Mahoning County.
By BOB JACKSON
VINDICATOR COURTHOUSE REPORTER
YOUNGSTOWN -- The resignation of former attorney John F. Zimmerman Jr. has created more problems for a charitable trust in Mahoning County Probate Court.
Zimmerman recently resigned his law license over allegations that he defrauded the law firm of Manchester, Bennett, Powers & amp; Ullman out of some $190,000.
Zimmerman was a partner and shareholder with the firm. The Ohio Supreme Court's disciplinary counsel accepted his resignation this week.
Zimmerman was also one of three people appointed to oversee distribution of funds from a charitable trust created by the estate of Walter E. Watson, a city resident who died in 1964.
The foundation makes donations to educational and nonprofit organizations and hospitals in Mahoning County.
The distribution committee already had one vacancy that has yet to be filled, leaving only Zimmerman and Thomas R. Hollern, president and chief executive officer of National City Bank, Youngstown, to handle disbursements.
Eugenia Atkinson, executive director of the Youngstown Metropolitan Housing Authority, has been recommended to fill that vacancy but has not yet been approved by Judge Timothy Maloney.
When Zimmerman resigned from the practice of law, he relocated to Florida and gave up his seat on the distribution committee, leaving Hollern as the only member. The trust's regulations require that there be at least two members to review funding requests and award money, said attorney Richard J. Thomas, representing National City Bank.
NCB is the court-appointed trustee for the trust.
Here's the problem
Thomas said at least one more member must be appointed soon so the trust can make distributions before the end of the year. If it can't make those distributions, it faces some $20,000 in penalties from the Internal Revenue Service.
The trust was already under Judge Maloney's scrutiny because he did not like the way National City Bank has administered it.
In 1999, the judge appointed attorney John B. Juhasz to investigate the trust's administration and make recommendations for improvement, which was done later the same year.
When he learned of Zimmerman's resignation and the allegations against him, Judge Maloney asked Juhasz to take another look at the trust account.
Juhasz said the review is only to make sure everything is in order, not to see whether Zimmerman stole money from the trust.
"I don't think there is any evidence that he even had any access to this money," Juhasz said after a hearing Thursday in probate court. "But it would be foolish of me to not look into it."
Judge Maloney also asked the charitable trust division of the Ohio attorney general's office to review the trust for the same reason.
NCB spokesman William Eiler said the bank welcomes the review and stands by its performance.
"Our bank continues to administer the accounts of the foundation in accordance with applicable law, governing instruments and sound fiduciary principles," Eiler said.
bjackson@vindy.com