The Wheeling daily intelligencer. [volume] (Wheeling, W. Va.) 1865-1903, 1876-07-28
Operations OF Ralst6n OF Califor.
mia.

San Francisco, July 27.-ln the Bull
letin alta.libel suit the further testimo.
ny OF Michael Rees and D. o. Mills, was
taken before the Third District Cour,
Commissioner yesterday. Rees testified
to the following effect: The failure Of
the bank was caused by Ralston taking
the money from it to expend on outside
affairs. Ralston was architect Of the Job
to sell the Spring Valley Water Works
and the Calararas Valley scheme to the
city at a profit OF about S8,000000.
helped him TO furnish large amount 10
buy up stock. l advanced between SS,.
000, 900 and 100000, and be had the
whole, management Of II; he expected to
make enough out Of the job to save the
bank from failure; 1t was the last thing
to do to save il. II the scheme had been
carried out, I don't think It would
have failed. Mr.. Ralston took the
funds Of the bank to carry on the water
scheme, Palace Hotel, Kimbsll Manuiac.
tory, Mission Woolen Mills, and other
outside enterprises. No one thought he
would take money, but the stockholders
thought 1t was his own fortune he was
operating with. I'put in S30o,000 ex.
change one day to make good the account
Of Leland Stanford at the bank at the
latter's request. After the failure OF the
bank Iiound the amount had not been
credited on the books, but Ralston had
taken it, and / gotta guarantee from
Ralston that the amount ahould go to
Stanford's credit, but received no Ger.
tifcate Of deposit; but took as security
bonds Of the Union Pacific Rail.
road, which Stanford had depos.
tied with the bank as security for It's
overdraits. D. o. Mills, referring to
the charge in the Alta Of September 10Th,
1875, that the proprietors Of the Bulletin
and Call remitted money TO Simonton, n.
Y, to speculate in stocks; that they stroye
TO make the panic as disastrous "a posi-.
bic, and were in conspiracy to break the
bank, testified: know OF no efforts OF
those parties to affect stock values to
break the bank or cause a public loss Of
confidence in II. The cause OF the fail-
ure OF the bank was that Mt. Ralston
used the funds. for his own purposes aud
did not replace them. This he did
surreptitiously and irregularly without
the knowledge Of the two directors. The
largest deficit was found in the refining
account, amounting to about $1,000, 600.
The refining was a separate corporation,
but under the control Of the bank. The
books Of the bank contained debit to the
refining account OF upwards Of 81, 900, 900,
which was fctitiously manufactured by
Ralston, who had evidently used tho
money for his own purposes. We also
found instances in which certificates OF
deposit had been issued, and In which
the money had never come into the bank.
One instance was that Of Carpenters GER
tiicate for over half a million. Ralston's
total indebtedness was over 100000.
You may call 1t what you like; II was
misappropriation. As to over issue
Of stock, i made no examination
Of that until after the bank had
resumed. ! am creditably informed
that there was an over issue 10 a
large amount, but it had been retired
and the stock stood all right when took
the books in hand. Witness evaded the
question by which such stock was retired,
and the point was was not pressed
by the Judge. II was retired in
the interest Of the Ralston estate
before the suspension Of the bank. There
were overtures made by persons interest.
ed in the bank to 20 into come arrange.
menta with Flood & 0'Bricn by which
that firm we're to take the bank and
carry II on, the parties making
the proposition offering to becoma re.
sponsible to the amount Of 81, ,000, 900 II
tie assets Of tho bank were not sufficient.
Twas a party 10 that. Do not know
Of any false news published by the Call
and Bulletin at that time. After the failure
Ihad IN interview with the proprietors
Of those papers and suggested that the
Newspaper controversy then going on
upon the subject was detrimental 10 the
prospects Of the bank resuming. They
said the controversy had placed them in q
false light. That they were charged
with doing things that they were
not guilty Of, but on my Informing
them that we were doing our best to re.
sumo they too favored that result and
agreed in effect to drop the controversy
and stop defending themselves. II wAs
admitted on all handS It would DO for the
interest Of the community and that they
would do nothing to impede Us ir the
work Of resuming. I think they alter
wards did all that was possible to assist
u.s.