The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1877-08-08
SUPERINTENDENT ELLIS TRIAL.
Mr.. ELLIS TESTIMONY EXPLANATORY OF HIS
OFFICIAL ACTION.

MR.. ELLIS TESTIMONY EXPLANATORY OF HIS
OFFICIAL ACTION.
SARATOGA. N. Y, August Z, 1877.
In the Ellis trial to-day at the opening OF the Senate,
D. C. Ellis, bank superintendent testified that tho first
time he ever heard tho about the Third Ave-
Bank, sworn to by Isaac Smith, clerk In tho
department. was at Saratoga; don't remember any
conversation with Smith about that bank; there was
4 special examination by Reid, Aldrick and others in
April, 1885, knew OF the $4,000 bonds which to
be givcn by tho trustees; influenced by all the
facts in bis knowledge; went to New York the day
Duncan, Sherman 4 Co failed; saw Mr.. Cisco.
and be coun-sllcd dclay; saw eight or ten
other business men; they said that tho market was
excited; IL continued all tho summer; acted the
opinion Of these anticipated that the closing OF
this bank would worry disastrous to other banks;
entioR first callod to the Mechanics and Traders
Bank by letter from Reid in 1874, about tho trouble
with the Secretary; Immediately went to New York;
tho bank deposits small; thcy continued to in
to the tmo Of the closing OF the Third Avenue
Bank the complaint was against tho management not
against the sovenoy OF the bank; the officers wore
called set OF robbers; examined the President and
Finance Committee; found them running on In their
way; gave them the choice close up or behave
themselves; found the bank financially sound; when
Reid examined the bank in December, 1874, showing
deficiency, tho Secretary came to see me;
told the Secretary the trustees mako up the dcd
cheney or would close them up the letter OF December
rs to know what had been done; received q tec-
gram saying they had put the bank 10 shape; Reid
ported IN 1875 that the deficiency had been made
good; relied on Reds report, as had no knowledge
TO the contrary next had attention called TO the bank
in August 1875; REID said, when told to go and look
ut the Beach street mortgage books that they
not systematically kept; they seemed all right; was at
Rochester when Lamb turned the bank over TO tho
Reid to keep watch on the bauk and others and
port; returned tho letters sent by Lamb and told him
70 look to the matter IN his lEis absence
+f 4F PE0rLE's
In the fall OF 1873, on she report o. Mr. Reid. Com
mencod proceedings TO close the Peoples Savings
Bank; some oil tho officers called and proposed to
up tho deficiency, and AS the bank had changed
its location anticipated better business; the trustees
had put In ono bond; proposed changing. giving in
dividual more binding; The SUIT was prosecuted
further then; went 10 Now York and looked Into
the matter: examined tho trustees bonds and mort
good in full Reid and the superintendent called at the
bank and made an informal examination OF tho assets;
did not make a formal report only knew that Reid
reported when The report produced trial; The
deficiency reported by Reid was than covered by
bonds held by the Department. thinks he ucted under
the letter received November IL, aud autographed
Reid TO send formal report; wrote the Attorney Gen
era to close the bank followed the figures Of Reid's
letter; the Attorney General prepared the summons,
giving the 1gueres IN the letter; when formul
came, as figures differed, no changed them 10 agree
with the formal report; after the Attorney General
had no further control tho bank went with re-
ceiver to witness tho deposit OF The assets OF the bank
tho receiver Of the Mechanics and Traders Bank
found after months work, that the cdgers were
not correct as Reid had accepted them.
LoANERs BANK. i..Hilw
Asked Smith, no had boon tho department
many years, N the Loaners Bank had made re-
port; ne said II had made q statement Blu, did not
know what had become OF II; he had examined and
could find powor 10 ,niorcc the law; Reid went and
tried TO examine; did not succeed; went @ New
they werc taxing Of paying up dopositors; handed
him tho opinion OF William Tracy, their attorney
hands OF tho Attorney General the bank was turned
to the receiver; intended leaving the bank to the
sS not s put op1u
making an examination; could not walk IN and tako
possession. - i4asal f tLt u ar
Never was inside OF the Abingdon square Bank
saw the officers; his only knowledge Of this bank was
attorney General July 20, 1875 on tho report OF Reid
by Lamb, Ellis being away; has no recollection Of
the bank closed; has knowledge OF the Receivers
actions.
His attention first called to the German Bank,
Morrisania, In March, 1875; Reid's examination
toned loan by former president railroad bonds;
the president and counsel Of tho bank Albany,
ana no told them they must make up the deficiency
they seemed very energetic ana did not want the bank
closed the former president deposited good ccllaerals
the officers seemed anxious 10 do all
that tho superintendent asked TO make
the trustees called after the bank put the
hands of the Attorney General and said If there had
been such RIM and u little moro time were allowed
the depositors would ali have boon paid; a large pro-
portion Of the depositors had signed petition prom
lsng TO lot their money lay in the bank II was not
put IN the hands Of receiver; bad Information from
the Attorney General that he was going TO try the
pertinent Of letting the depostors vOtc pro rata for
receiver; facts came TO his knowledge to destroy
his confidence in the bank.
In the law OF 1874 the New York Loan and Trust
Company 10 required 10 report examined IN February,
1875, after the report camo in he examined The law
and charter by which he could return them 70 the
Attorney General; convcrscd with tho trustees
tho manner Of CLOSING up if4H+l fiir Ni4t
SECURITY SAVINGS BANK.
Attention was especially called 10 the Security Saw
ings Bank IN November OF 1875; considerable excite
mcnt prevailed IN New York at the time; Mr. Reid
made the examinations had conversation with tho
PRESIDENT they had practically closed Tor few
while the examination was being made; they claimed
they were solvent; Mr.. Eilis told them the de-
hcicncy must DO made up; he gave them all tho time
possible, rs they were not doing business; tho
bank finally closed by tho officers IN January;
live or six banks closed aftcr the Third Avenue;
NEW NuRsED.
/ Attention was called to the Muua Benefit Savings
Bank three four days before the receiver np-
pointed; Mr.. Reid made an examination, found de-
cheney ana told them they must make 1t up; they
asked time to mold meeting OF trustees; tho day
before the time expired tney appointed receiver
without his knowledge; tho deficiency small |;
trustees were always allowed to make up dehc,ency
IN banks; in fact all new banks have to be
propped up by their trustees; II any Of
The banks holding mortgages we're put under
the hammer, they would be insolvcns; In
time of great depreciation In stocks they
might be So but II allowed to go on would be all right;
the superintendent exercised his best discretion In
security Savings Bank was cool and ought go
IL practicable with the force Of the department
TO examine every piece OF property the books hold ;
HAD q 200 different mortgages; could only take
the papers as they appeared to him; thoy are rc
ported ut face value In the present state OF the real
estate market; II their mortgages orecoscd lew
banks could pay their depos tors; run would force
foreclosure OF mortgages, large proportion OF which
taken when real estate was IN bettor condition
II let alone they will pull through.
The Senate then adjourned