The New York herald., 1868-01-28
THE FARMERS AND CITIZENS NATIONAL
BANK.
Legal RrOceedings Commenced Against tho
Receiver Of tho Bank-Revclati0nsR Regard
ing the Management Of the Concern.
From the BROOKLYN Daily Times jan OFT

ing the Management of the Concern.
From the Brooklyn Daily Times jan 27l
This morning the long threatened proceedings the
part Of the late directors Of this unfortunate institution
for the recovery Of the control Of its affairs
menced. Mr.. Frederick A. Platt. the receiver Of the
bank appeared at his post usual about O'Clock,
and was served By Deputy Marshal Nodyne. who was
waiting his appearance with the following document:
The President OF the United States Frederick Plat
you appear before the Judges the Circuit cour!
New York in the second Circuit IN Equity the rs.
then % p I'll y As
in the said court by the Farmers and Citizens
ns = 40 @
you not 10 omit under the penalty OF hundred and
Wiiness salmon Chase Chief Justice Of The supreme
so asy Of ny I II hs % 9g @ s and %
croois. Bergen Pratt, compianani's solicitors.
cause the Clerks oss Setars
o ~o q them q w. ns sEWrN C c
Crock Bergen s, Pratt, co%pai1snss socors
Now York The farmers and Citizens National Bank Of
ny of hs t.sa sss and mabS
ofCurrency. and Frederick A. Plat Suepcp al Rspon-
The late directors assign as q reason for commencing
this proceeding that being familiar with the affairs OF
torily and with less loss than "outsider.'i This,
however. is a question merely mootcd. Mr Ia,f, who
was selected by Mr. Calendar the bank examiner after
inquiry in leading financial circles In New York,
doubtedly thoroughly convcrsant with tho business Of
banking. For about ten years he was cashier OF the
Corn Exchange Bank. an institution with million OF
Capital Mr.. Plat took POSSESSION Of the bank on the
9Th OF September last, and since then, with the
efficient assistance OF hr. Charles W. Cox, has
been busily engaged in communicating a liquidation
He was momeniariy expecting the issuance OF order
by the Comptroller Of the Currency directing the pay
ment of dividend to deposi.ors, probably fifty cont
The opening of this litigation will have the effect OF de-
laying this dividend, perhaps indefinitely, and mean-
while the funds OF tho bank will be absorbed by tn
costs OF litigation Its affairs have been managed inn
properly aud illegally Mr. o. d. Beach, the late cashier
tho directors in state OF bissful ignorance For
instance the developments have disclosed shim NJ
indebted to the Institution for money borrowed
in his own name principally to the sum OF $50 600
The national banking law expressly provides that
person shall borrow moro than amount equal to
tenth Of the capital stock Of bank. Mr.. Beach on
being sued in the United states Court OF this district
up plea OF want Of Jurisdiction averrng that the suit
should be brought in the state coursa mere preencc
gain time Mr.. David Williams, president OF tho
Long Island Navigation Company Of which body Mr.
Beach was treasurer, was permitted TO ''fp' $IS 900
$40 900 more, making their Indebtedness SSS 600
In all Here was gross and papsbis VIOLA
rsctors confess TO no knowledge Of these things.
They were amazed 10 fnd that Mr. Beach owed more
than $40 900, which sum they knew he had borrowed
q few days before the bank seized IL appears
that about hundred have been commenced by
Mr.. Platt against defautng parties those who have
biitiss foot up some $267 900, and there still
TO be waited He believes that the entire capital Of
tho bank win bs absorbed in concluding settlements
OF the SEIZURE distributed among hundred parties
many Of whom are men OF limited means, and now
selling their claims, from despair and want . dis
count Of from fifteen TO twenty-five per cent
Twelve hundred thousand dollars q largo sum OF
money to be held by institution which had been
fortunate In It's management almost from Its inception
and had previously succumbed TO financial pressure.
These large deposits accounted for in this way The
bsnk did what other concorn will do, and what
other concern Afford 70 do. paid interest 70
depositors, 10 some nigh six per cent and
for large Of money at that No bank In Brooklyn
New York pays interest to individual deposors and
very few allow any 10 savings banks, and thea only
three per cent.
Another illegal feature in the management was that
the bank made loans Its own stock.
The directors Of the late bank doubtless we'll
meaning and good citizens; but after this exhibit
OF their free and easy way Of doing business the
munitv will hardly sympathize with them IN their At
tempt regain control OF is affairs. Besdes litigation
defers nal settlement and will entail additional
penss on the banks credtors