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When Lydia and Everette Thompson disappeared nearly 18 months ago, along with their two young sons, their neighbors were not particularly worried.

Residents of the 8100 block of South Rhodes Avenue, a street of neat brick homes in the South Side community of Chatham, said they thought the Thompsons had gone on vacation. Some heard they had moved to Philadelphia.

But police and FBI agents started asking questions after the Thompsons failed to show up for several weeks at the pizzeria they owned. Although they found no bodies, they eventually uncovered a string of tantalizing clues indicating foul play, including a pair of blood-stained men’s gym shoes and a blood-soaked child’s sock.

On Tuesday, a federal prosecutor dropped a bombshell in court, saying officials suspect that Lydia Thompson’s brother, who had been brought in on a complaint of bank fraud, was responsible for “ax-murdering” the Thompson family.

The unremarkable complaint on which Kenneth White was ordered detained, pending a preliminary hearing, alleges he defrauded Citibank by depositing in his savings account “a check in the amount of $13,272.81, made payable to Lydia Thompson, bearing what defendant knew to be the forged endorsement of Lydia Thompson.”

But in an affidavit attached to the complaint, prosecutors presented the outlines of a much more dramatic and gruesome crime.

“The surrounding circumstances provide substantial evidence the defendant ax-murdered his sister, her husband and their two children,” Assistant U.S. Atty. Jacqueline Ross told Magistrate Judge Ian Levin.

After the judge reminded her that the defendant “is not charged with murder today,” Ross clarified her statement.

“The offense is bank fraud,” she said. “But it is the government’s position that the murders were carried out in the furtherance of that crime.”

The complaint alleges that White, who has a long criminal record, committed the forgery to get his sister’s share of the Rhodes Avenue house that they had inherited from their mother. The murders, it implies, were part of that scheme.

White, 42, a tall, lean man with close-cropped hair and beard who was shackled hand and foot, denied the allegations.

His court-appointed lawyer, Charles Aron, said he found the notion of a bank-fraud complaint containing implicit accusations of a quadruple homicide highly unusual.

“In 25 years, I have never seen an embezzlement complaint that contains allegations of murder,” he said after the hearing. “Right now the charge is embezzlement. If the government says there’s more . . . I want to see the evidence.”

Aron noted that White had been scheduled to be released Wednesday from a state prison, where he has spent the past 13 months on a parole violation in connection with an unrelated conviction for criminal sexual assault.

Chicago police Tuesday confirmed they were investigating the disappearance of the Thompson family. A department spokesman also confirmed that Lydia Thompson had called 911 two days before she disappeared, complaining that White was threatening her with an ax. But the spokesman would provide few additional details on what he called “a federal case.”

According to the affidavit, Lydia and Everette Thompson and their children, Everette Jr., 11, and Andrew, 8, disappeared from their home on or about July 5, 1996.

On Aug. 1, the manager of the Thompsons’ EatCo Pizza, at St. Lawrence Avenue and 71st Street, told police that Everette Sr. had left the restaurant about 3 p.m. on July 5, saying he planned to pick up his wife. The manager said she never saw any of the four again, but White came by about 5 p.m. in their van, saying his brother-in-law had been arrested after a traffic accident. Police said there was no record of any such arrest or accident.

The manager also noted that White had red smears on his new white Nike gym shoes.

Over the next few months, White gave neighbors and investigators conflicting stories about his missing relatives: Everette Thompson had taken his family to Philadelphia in the van. They had gone to Philadelphia on a bus. They had boarded a bus to Minneapolis. They were in Hawaii.

The affidavit alleges that White sold the Rhodes Avenue house by forging powers of attorney in the names of Lydia Thompson and a third sibling. The inspector who checked out the house in August 1996 noted that the kitchen floor had been torn out and that a toilet and bathtub had been painted red.

But a police officer who had answered the 911 call on July 3 said she had checked out the whole house and found the kitchen floor intact and no red bathroom fixtures.

After selling the Chatham house, the affidavit says, White moved into a trailer in Gary. FBI agents later found a pair of men’s gym shoes in the trailer and a child’s sock in a crawl space under it. Both tested positive for human blood.

Back in Chatham, a Christmas tree is elegantly decked out in gold ornaments and holiday lights in the front window of the Thompsons’ former home, where another family now lives.

Longtime neighbors said the Thompsons had fit well into the quiet community, mostly keeping to themselves.

Hurley Alcorn, the block club president, said White, who moved in with the Thompsons in early 1996 after being paroled, had a reputation for being “a mean guy” who was in and out of prison.

Prosecutors noted at Tuesday’s hearing that White had a long history of convictions for violent crimes, including four criminal sexual assaults and two burglaries.