The Union and journal. [volume] (Biddeford, Me.) 1858-1882, 1860-03-30

anu uuNiser IN tne business was ht. buuiey
T. Leavitt. who seems also to have been the
agent in consummating many OF the oojec-
tionable negotiations.
The first considerable transaction with the
Norombega was their taking Peck's cheek
on Suffolk Bank for $4,000. giving him the
money therefor and holding the check until
il suited his convenience to take it up. This
transaction was not considered a discount,
and was not carried to the books as such.
The check was counted as cash. and the cash.
, Ter alleges that il was taken with the knowl-
edge and assent of some of the directors. but
not at one OF their meetings. Peck paid no
interest on this $4,000. the consideration be-
ing the deposit he kept in the bank. Short
ly after. however. he had check Of $4,000
cashed in the same way, and on this amount
he paid interest. This was to be held the
same way the other was, and to be paid tho
same way. and the transaction had the ap-
proval OF several of the directors-not one oil
them indeed obiecting. according to the tes-
timony Of Mr.. Smith. Besides these checks
so unwsrrantably cashed by the authority OF
the bank, Mr.. Smith alleges that he gave MIR.
Peck some $4,000 or $4,000 OF the banks
funds during the summer OF 1859 without
any knowledge whatever on the part OF the
directors. and without making any entry oil
the fact on the bank books. Peck gave his
checks TO Smith. and thelatter says :-"Peck
agreed 20 take the Norombega bills and not
let them come back until he paid the checks"
IL appears that as the October examination OF
the directors approached, Mr.. Smith grew ve-
~ uneasy in regard 10 the money which hc
had secretly loaned to Peck. The latter.
however, by deposits at the Bank OF Mutual
Redemption, and other expedients, succeeded
in saving himself aud Mr.. Smith from merit
ed exposure. As soon, however, as the criu-
cal day was passed, the criminal game began
afTesh, and Mr.. Smith advanced money on
these 81 urious securities until, according to
his own account, he had Sl6,3OO OF them on
hand. In regard to the parties negotiating
them. Mr.. Smith says:
..Peck did not personally negotiate with me
all the checks took previously to Dec l., lo19'
Mr.. ID. L. Lcayitt negotiated the rest. I'M
derstood that Leayitt was acting as feeks
agent"
Mr.. Leavitt seems TO have been entrusted
BY Peck with official checks "in whole batch
es,,' to be used as eXigcncies required. As
illustrating this point, Mr. Leavitt in his test
imony said:
.After the Norombega Bank blew up, let
Smith have all OF Peck's checks had ON hand
amounting to $3.50. This was after the Ne-
ceiyeIs took possession.
Mr.. Leayitt thus explains his reasons for
surrendering these checks to Smith:
"Before the Norombcga Bank failed, Peek
sent for me to get him S5,VOO OF theF ohS'
which GOT and sent 90 him, but then gave no
check for il. The Monday before il failed,
/ got =! 800 to pay note OF Hallowell and
Smiths at Boston, and gave no check then.
| After the failure, / gave Smith these checks,
amounting to $3.50. | got, as above stated,
81 800 from the bank, leaving an excess OF ST.
$50 in PeCk's checks, on which no money mas
been paid, and ON which Peek has received no
money"
In addition to the checks thus negotiated
by Smith without any authority whatever,
| Peck obtained from Schwartz, the President
of the bank, discount OF time checks in
December, amounting to $4,000. This trans.
action was understood TO have the approval
OF the directors, and the three checks, 81 900,
~ 5000. and $4,000, given for the amount,
| were made payable respectively on the Sec
ond, fifth. and sixth of January, lS6O,-thus
obviously TO be provided for out OF the treas
ury funds Of the present year, should Mr..
Peck succeed in retaining his control OF them.
The money thus advanced to Peck was not
entered as part Of the loan of the bank, but
the checks were counted as cash on hand.
On the 22d OF December, according to
the testimony of Mr.. Schwartz, the presi-
dent, Mr.. Peck came to Bangor for another
loan. He gave him the most positive as.
surances of his reelection, and promised
for the next year to keep better deposit IN
the Norombega than he had previously
done. Mr.. Schwartz, however could not
be induced to grant fresh loan to Peck,
but after farther conference, was prevailed
on to exchange checks with him Tor Sl2 ,OOO,
Peck telling him that he wanted the check
fer one day only. Schwartz gave his check
TO Peck for that amount, and Peck gave
Schwartz his check for the same sum-
Peck at once proceeded to the cashier with
Schwartz's check; had the amount passed
10 his credit and certificate OF deposit Tor
the same, together with the deposlte then
in his favor, was at once given him by the
cashier. Later in the day Schwartz put IN
Pcck's check, and the $4,000 with which
he was credited few hours before was
again charged against him. The bank was
thus neither loser nor gamer to the value
of cent, but Peck had certificate OF do.
posit which made him appear great deal
better for the time at the treasury Office IN
Augusta. After this transaction was CON-
pleted, Schwartz and Smith talked 1t over
and agreed according TO the admission OF
both. that the certificate was to be used by
Peck ain making his balance good at The
,reasury.n There is no evidence, however,
going TO show that Mr.. Schwartz had any
knowledge whatever Of Peck's real stua-
ton, or that he medl,ated being any party
TO the fraud which was thus attempted. lie
assen,ed ,o the arrangement without appar-
emily comprehending It's real scope, aud all
his foars were Quieted. he says, by Smith,
who systematically deceived him both IN re-
gard to Peek and the bank. The transac-
ton, however, in i,selfis too culpable TO ad-
init Of any apology or extenuatioD.
The books Of the bank, exhibited to the
Committee by the Receivers, reveal other
serious ACKNOWLEDGEMENTS on any
presumption of honest intent on the pat OF
Peck or the cashier. For example, on the
10Th of November, the books show a bal
ancc Of S35i5,07 agains, Peck, and carry
inr the accoun, to new page he is credit
ed with $3.50, ,22-without any intervening
entries on which the change from debtor To
creditor could have been based. On Dec.
2i,h, some credits aud debts intervening
from last date, there appears to have been
balance TO his credit of S3l7I,6S, where
"a. by honest addition aud subtraction, he
was at that date indebted to the bank in
his regular account in the sum OF Si039,7l,
which the Receivers now claim from him.
These entries, therefore, clearly exhibit a
f,spd upon the bank Of S72li,D.
There is some discrepancy between the
statements Of Smith on the one hand ana
the Receivers on the other, as to the gross
amount OF Pecks checks in the bank, out
this the Committee have not felt called up
on to srbitrate, inasmuch as the settlement