The Morning herald., 1876-04-24

were the result of irregular orders or in
competent bookkeepers. Witness related
large number of instances Of fraud perpe-
trated at different branches by the officers
Of the bank; the whole business was coR-
Quoted everywhere, except at Richmond, In
the most careless manner; officers stole the
funds and admitted the fact, but plead
poverty; they were frequently in the habit
Of making loans to relatives without taking
security for the amount; as to the Wash
ington Branch there was no wrong amount
ing to criminality unless negligence, or
rather, incompetency, is criminal; If Bos-
ton, the bookkeeper there, had been smarter
he should say there was fraud, but Boston
was too dull; there was a good number of
transactions that were concealed, and
among them was that relating to the Sea-
aca Stone Company, the papers in that case
disclosed the fact that loan was made to
Hallett, Kilbourne and John 0. Evans
of Sc, 900 at q certain time with certain
collaterals attached, and secret agreement
was drawn up between the actuary and the
finance committee, and these gentlemen,
that in case the note was not paid at ma
turity, the note and all the securities ex-
cept the bonds of the Maryland Mining and
Manufacturing Co.'s notes, and that the
bonds in question, that is, the Seneca Stone
Co g bonds, should be taken in full pay
ment of the note. The note did not mature
for year. When it did mature, the &C.
tuary, Col. Eaton, demanded payment and
the parties stuck at him this secret agree
ment and refused payment. There was
good deal Of wrangling about it, and finally
the note and other papers were given up and
the Seneco Stone bonds retained. These
bonds are not worth anything and never
were.
VIM. Kilgour of Alexandria, testified
That he has as client, colored man
named John Watkins, whose money was
drawn ont of the Freedmen's Bank on
fraudulent checks, and that it was drawn
out by T. 8. Boston, the teller. He looked
into the matter and found that Boston had
forged between ten and eleven hundred
dollars. Boston was the son-in-law of Will
son, the cashier and was afterwards COM
PEELED to pay Watkins in instalments; ii
further appeared in evidence that the
bank loaned $93 900 to the Young Mems
Christian Association Joint Stock Com.
pany. The association owns about $15,-
600 worth of the stock out of 100000
worth issued for the building, which, with
the exception as above stated, was held by
different parties. A deed of trust on the
property was given to secure the loan.
Mr.. Sperry was recalled aud was asked
to state in general way, all the causes
which we're most prominent In bringing
about the failure of the bank, and he re-
piled that If there had been scrupulous con-
formity to law in every particular, and
carfulness III selecting Investments, the
failure would not have occurred. The first
fatal departure from sound policy was
the erection of the large banking house in
Washington. There got to be around the
principal Office of the company au un.
wholesome SAVIOR of connection with what
was popularly known as the District
ring. At any rate the manage
/. ment was first opened to criticism
by the politicians the causes of failure
were undoubtedly the panic of 1878, and the
ostensible though not the real connection of
the bank with jay Cooke & Co. This led
to such reduction Of the balances held by
depositors that even If nothing further had
trsnspired the institution would have beer
closed by its expense account.
J. W. Alvord test:fed to loan of over
$75,000 to the Howard University. The
trustees Of the University besides himself
were Senator Pomeroy, Bishop Talbot
DlouOp OIOWu, 1ICN AOA6Auoey C' A' ouAUii
and G.. W. Balloch. That loan was for the
payment Of the construction bill for profes
sors' house, for the building erected, for thu
normal departments and for bills which
had accumulated in the foundation work
It appeared In further testimony that Presi
dent Grant, General F. Dent, W. H. Seward
J. K. Barnese, Surgeon General Caleb Cush
ing, and others of equal prominence wert
stockholders in the Seneca company.
G. B. Purvis, trustee of the bank since
March 1868, testified that Mr.. Stickney
who was the actuary, had authorized ,
man named Boyle to sell large number o
bonds belonging to the bank-this was afte
Jay Cookies failure-witness demanded Mr.
Stickney's removal, there was loan o
$21 900 to Boyle on which Stickney tool
security and the bank has never realized :
cent from the loan.
A large number of witnesses we're ex
amined to show that loans were made tt
prominent individuals in the district ant
elsewhere, without requiring proper security
Joseph j. Stewart testified that he was
trustee Of the bank but resigned in 1872, be
cause he thought the management of tn
institution unsound and all his efforts t,
correct 1t proved unavailing. He had give,
an opinion against certain investments ant
he saw that his views were not acceptable
and that the institution would not be gov
erned by them. Mr.. Purvis had frequently
protested against the loose manner Of doinf
business but his protests were unavailing.