The federal government contended in a civil suit filed yesterday that Alphonse G. Hill, the District's deputy mayor for finance, concealed and lied about $50,000 in personal assets that he could have used to help pay off a defaulted loan he had obtained with the assistance of the Small Business Administration.
Stanley S. Harris, U. S. attorney for the District of Columbia, claimed in the suit that Hill, before he joined the District government, failed to pay off a $123,000 loan and asserted in a written statement filed with the SBA in 1977 that he had no means for paying it off.
In fact, Harris contended in the suit, Hill and his wife, Jeweline, at the time had $50,000 in U.S. Treasury bills, money market funds, and certificates of deposit. Jeweline Hill is also named as a defendant in the suit.
The suit asks for recovery of $123,000, which includes past due interest on the loan, and a penalty of another $123,000, which the government is pursuing under the False Claims Act.
Hill and his wife could not be reached for comment yesterday. His secretary said they were on vacation in Jamaica. A spokesman for Mayor Marion Barry had no comment.
Barry appointed Hill as one of three deputy mayors last December. A Chicago accountant, Hill joined the District government in August 1979 as the city's first controller.
In that post, Hill has tried to untangle the city's disorganized accounting system, cutting down on duplicate payments made for the same services and ordering a crackdown on people who pay for parking tickets and other city obligations with bad checks.
According to the civil suit filed in U.S. District Court yesterday, Hill's problems with the SBA stemmed from a loan he, his wife and another partner obtained in 1975 from Continental Bank and Trust Co. of Chicago so that they could acquire a laundry and dry cleaning facility in that city.
When applying for the loan in 1974, the suit says, the Hills and their partner, Norman S. Jones, asked the SBA to guarantee 90 percent of the loan, meaning the federal government would pay that percentage of the loan if it went into default. The SBA guarantees such loans to encourage small businessmen. Jones was not named as a defendant in the suit.
In the same year, the bank approved the loan to the company owned by the Hills and Jones, H & J Enterprises, with repayment personally guaranteed by the three. Originally applying for $115,000, the three later asked for and received a total of $123,000 to cover damages that had occurred at the property and to provide additional funds for the business, according to the suit.
After the SBA approved the application in March 1975, the suit says, the borrowers received the money. However, they asked for and received moratoriums in making repayments from July 1975 through March 1976.
In March 1976, Continental Bank notified the SBA that the loan was in default and asked the agency to make good on its guarantee. SBA did so by disbursing $118,449 to the bank, the suit alleges.
In 1977, according to the suit, Hill claimed in a letter to the SBA that he and his wife "were unable to make any payments to the SBA on a monthly or periodic basis."
Based on that claim and another financial statement Hill filed with it, the SBA agreed to settle the Hills' debt to that agency for a payment by the Hills of $1,300, the suit claims.
"The representations contained in the financial statement of debtor were false or fraudulent, as the Hills knew and intended, in that it concealed, omitted, and failed to disclose approximately $50,000 which the Hills had invested . . . ," the suit says
In signing that statement, the Hills verified they knew that submitting a false statement was punishable by a prison term of up to five years or a fine of up to $10,000, or both, the suit alleges.
The government decided against bringing criminal charges, according to a source familiar with the case.
Royce C. Lamberth, the assistant U.S. attorney who heads the office's civil division, said he could not comment on when the government learned that the Hills allegedly had $50,000 in personal assets that they failed to disclose.