The sun. [volume] (New York [N.Y.]) 1833-1916, 1876-01-27
THE BANK OF CALIFORNIA.
The Motion for an Injunction by the Worm-
ser Brothers- Crooked Einnnces.

The Motion for an Injunction by the Worms
ser Brothers Crooked Finances.
SAN FRANCISCO, Jan. 1.-THE United
States Circuit Court Of this district Is engaged
to-day In the hearing OF arguments I'm the mo-
ton for injunction by wormser Broth ers, who
ask that the collection OF the assessment Of $40
per share lately levied by the Bank Of California
may be restrained Upon the Ming Of the com
plant few days since. preliminary injunction
was granted.
Upon the failure Of the Bank Of California, the
directors soon ascertalned that they were at law
personally liable for all its outstanding obliga-
tions including the par value Of Its capital stock.
To escape this liability then became their
object, and many OF them knew the ropes,
having had similar experience IN the
Pacific Insurance Company, which, after
advertising the individual liability OF Its
stockholders all over the United States, sue
ceeded, upon the occasion OF the Chicago nre,
In wrlggllng out OF its losses for about ten cents
on the dollar. And with view TO this evasion,
though for the ostenslble purpose Of carry
Ing on tho bank, the so-calcd Syndicate
was formed, which consisted Of number Of
individuals, made up from the old trustees Of
the bank and some OF the heavier creditors,
who agreed TO subscribe a certain sum EACH Of
which only ten per cent. was payable in cash. to
80 raised was loaned to the bank, at eight per
cent. Der annum, and was used IN the payment
OF such OF the smaller depositors and cred
itors as had not sufficient confidence to
wait for their money. In order, IL was
said; 20 give power to the syndicate. the
stockholders were required to surrender
their stock, upon the promise OF pro rata pay
ment out OF any funds remaining after the Syndt-
cate advance had been repaid, and all the out
standing liabilities OF the bank extinRuished.
As the liabilities were then stated to be some
sixteen millions more than the assets. II Is APP
"a lDr m
dividend to the stockholders; while at the same
time the trustees fondly hoped that the surren-
der OF the stock would relieve them Of any further
responsibility IA to its value. hut how quickly
do bright things come TO confusion" for now
tho lawyers cav that the Syndicate only re-
ceived the certificates OF the stockh olders as
trustees, and as such are bound to exhaust all
legal remedies to obtain the full value Of the
stock, even to suing themselves, should that be-
come necessary. That Is to say, the Syndicate
must sue sucn of It's Individual members a. were
OF the old Board Of Trustees for the value Of
the stock impaired by their negligence.
After majority Of all the stockholders had
given up their stock IN this manner, the Syndi-
cate. In their capacity Of directors OF the bank,
levied an assessment OF so per share, TO obtain
money TO repay the advances made by them TO
the bank, and TO freeze out such stocl<hold-
ers as would not como into the arrangement;
and It Is this assessment the collection Of which
the Wormser Brothers seek to enton.
singular state OF things exists In this COM
munity In regard TO the affairs Of the bank. The
partisans Of that defunct institution, including
those who were the recipients OF its fayors, and
who now rank among " unavailable assets"
influence, characterize any mention OF ir-
regularities In the former management Of
and an act OF nendish malianity. Now,
a. Ralston had the entire charge OF the bank for
many years before his death and during that
| time lost aud squandered all Of It's capital and
assets, together with the funds OF It's depostors,
| ana every available piece OF property that could
| be converted into cash, doing many acts which
would have subjected him to criminal prosecu-
| ton had he lived. with the effect of running
thousands Of lcrsons who blindly trusted
| him, IL seems little strange that all these
offences are to be condoned ny the simple
had better cinonize Judas Iscariot ana set up
| Guy Fawkes as II holy martyr. couple
OF incidents discussed at the annual meeting OF
| the stock oiders of the bank. held a few weeks
since, will show the sort OF Transaction carried
on by Rtiston, ana condoned ana covered up by
his mariners. sharon. Mills and company
| Gov. stanford, OF the Central Pacific R3iroad,
| deposited SjOJ,OOl Of United States bonds with
| Ralston, security for over drafts, and when
| be went for his property II was no longer to be
found, but had been sold aud the proceeds ex-
| pended.
| Mr.. Carpenter Of Oakland deposited $4,000
| In the bank an1 received therefor certificate
| Of de pOsit, signed 10y tue cashier and by lston
| as President, and when he Z He'd for his money
| there was no entry whatever to be found In the
| books Of the bank in evidence Of Its receipt.
| Again, Halston habituily borrowed money
| from other banks to provide coin for settling
day,' when the directO. = committee examined
| the books, and counted, or PRETENDED t. count
| the cash. These loans were secured by bullion ia
| the refinery belonging 10 the bank, simple oruof
| for the bullion being given. which was returned
| when the loan was repaid. IL was apparent,
| upon Investigation aud a COMPARISON OF notes
| that portion OF this bullion belonged to the
| Mint; that several loans were frequently effect.
| ed upon the same bullion, each heing for its
| full value, and that not unfrcquently loans were
| effected upon, and orders gwen for bullion
| wnen there WAS none Ia the refinery ut ali. IL
| short, there was scarcely any description OF
| fraudulen. trckcry that not freely
| and frequently practised &C the bank
| but these, II seems, are not to he mentioned
because the princtpd perpetrator Is no longei
| there TO answer for his offences.
| But the mission Of The SCN Il to let light
| Into dark places, and the sooner the whole truth
is t1po-ed 10 the light OF day the better II
| Will be.