The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1877-05-01
BANK SUPE RVISION.

LOSSES.
The Senate committee. Senator Coleman presiding,
yesterday morning resumed the Investigation OF the
charges against Bank Superintendent, Eis IN paror
4 No 233 OF The ST. Nicholas Hotel Present were tho
three senator's Mr. Ellis, Receiver Best. their
sci and Bank Examiner George W. Reid Mr.. Mack,
who represents the additional charges against Mr.
Ellis, also in al ten lance part OF the time. con
siderable part OF the day taken up by Mr.. Best
reading the minutes OF tho bank showing that various
dividends declared by the bank directors. Mr.
Floyd and Mr. Gregory in every protesting. at
!. times when Dir. Best claimed that there de-
4 fciency.
Mr.. Thomas Scldner real estate agent, was hrst
called TESTIFY the value OF the Mechanics ana
Traders b INK building in 1873 He SAID that nc was
well acquainted with the building and judged u TO be
worth IRON sllo. 900 TO Sllo, 500
| Mr. A. A. Gould, oil No 1876 Prospect place, Brook
| Ign, also called expert He had been real
estate dealer for number OF years He knew the
premises on President street owned by tho bank. In
1874 they worth $4,000. since that time Brook
Ign property had about nifty per The
| property was now worth $l5, 600.
| Mr. Brinckerhon, New York real estate broker,
said that in 1874 the bank building worth from
! 100000 10 100000. 1t was worth that much for
banking or Insurance purposes.
/ The exam nation OF the minutes OF the bank
then entered Mr. Best read from the minutes
! the various portions he wished to put in evidence
They showed that when tho question OF reduction was
brought up It always deferred and action was
taken on subject They showed that dividends
were declared several occasions when Mr. Best
claimed there a deficiency. Mr. Chapman, counsel
for Mr. Ellis, said that he proposed to show there was
no deficiency.
| THE CROSS EXAMINATION
Mr. Best was next cross-examncd the minutes
by lr Chapman. In answer to the laters questions
directors tho depostors would have become alarmed
and the bank would have been obliged close up.
Senator 81. John asked II the bank could not
have required sixty days notice IRON depostors
| before the withdrawal OF Their deposits Mr.. Best
said that the rule, and that II had often been en-
forced since 1873. There would be no very sudden
| closing up in dividend had been declared;
| two months delay could have been obtained. Tue
report OF the committee. consisting OF Messrs
$751; sos IL. These figures had been substituted for
s255,oso 81. which had been crossed ou~ The differ
| latter amount for interest oue depositors on
June 80, which had been counted as principal
| after that date. This did not seem TO BIO
known to the committee and at first they made the
mistake Of adding interest again where It had been
already added to tho principal Mr. Chapman SAID he
proposed TO show a further mistake OF sl12.ooo The
salaries OF officers and other expenses OF the bank
next examined. In 1872 these were S34 500 IN 1878,
when Mr.. Ellis became Superintendent, they wero
s23 9oo IN 1874 s24,2s2 ST. 100 OF which was ar itga-
tion, and In 1875 the expenses SIS 000 Mr. Chap
man then endeavored to show that there had been u
continual reduction Of expenses ON account OF the sus
OF his client, the Bank superintendent SEN
ator ST. John asked II there had not also been
tnual reduction in the banks receipts Implying that
tins would also account for thc decrease IN e *.
October, 1875, the dcpositors began TO draw out
their money rapidly. Up 10 the time Of Mr.. Best's
becoming they had drawn out 81 900 co., Tho
amour: OF deposits In 1873 was ~, 93l JAS %, 10
1874, s25652 52 So; in 1875, $2,43e.52o So In the
meeting OF November ., 1874, the communication from
Mr. Ellis was read. II moved that committee be
appointed TO confer with the superintendent Mcssrs.
Floyd and G rcgory voted against IT, Al the meeting
OF November 20 the committee recommended
piance with the suggestions OF the Bank Superin'cn
dent Floyd and Gregory voted against accepting the
report ''rhen" said Mr. Chapman, 'rhey were OPP
posed to committee 10 confer with the Supcrinten
dent and voted against adopting his suggestions"
In 1874 Mr. Gregory reported that the value of tho
North and South Carolina bonds held by the bank
was SEQ o The tennessee bonds
which were put down IN the Supcrintendents report
at 5s,s afterward sold AT o.. Rochester bonds which
sold par In October in January 1875, were selling at
1855.
A short recess taken O'Clock After tho
recess Mr.. Gregory recalled and submitted to a
rigid examination by Mr. Chapman. Witness
tho expenses OF the bank should be reduced but had
authority to examine tho condition OF the bank !;
they did examine the bank aud found the deficiency
above stated Tho mistake OF $40, 900 was here gone
again and the Tectihed affidavit offered IN EVIL
ccnce further item OF $l02 900 cash CLAIMED TO
have been omitted from Mr. Grcgorys complaint
This Mr.. Gregory could not point out IN his aidavI
There item OF 10000 OF the Goulard estate
which had not been carried out
Mr.. George W. Reid, Bank Examiner, was next
called defence. On october 0, 1914, IN CON-
pany with superintendent Ellis, be began thor
ough and critical examination OF tho affairs OF tho
bank; tho examiraton lasted about week; tho DELI
cheney found about S24 9Sl 90; this counting
500 900 OF accrued interest," the bank should not go
however TINS interest would not be due deposors;
they would not receive any interest from the last dvl
dcnd tho surplus II tho bank had been closed up
would have amounted IN October, 1872 10 slios TO-;
the deficiency only constructive one At that time
and not an actual deficiency TINS amount alter
ward actually made up before the ls OF January oy the
apprec IN value Of securities held by
tam authorities 10 whom he had been recommended
that he could not remember 10 whom no
had been for the valuations OF tho Alabama or
North Carolina bonds In regard TO tho South Cai o.
lima bonds he different kinds, but did
not know how many there were OF EACH KIND and took
10 memorandum Of them the south Carolina bonds
quoted at ~ In valuing no averaged them all al 30.
When asked how he did TINS, no replied: - can't
tell how | did 1t; can't explain u; IT'S fac thnps
ALL" He SAID that when there were very few sales he
generally exercised considerable discretion
On redirect examination u was shown that his val.
uation OF Alabama bonds only differed sT25 from that
OF Mr.. Grceory IN a block Of 100000 Tho Tennessee
bonds had been uDdrryalucd
Mr Alfred +. Congln next testified -He had boon
president OF the Mechanics and Traders, savings Bank
several tines 1874 the Brooklyn Park bonds had
risen IN price that ST. 900 gained Tor the bank
deficiency OF tho bank was reduced by
so much; Mr Floyd had gwen great deal OF trouble
TO the bank; at one time he GAINED to have been
elected president, and brought SUIT against witness;
that suit was decided IN witness avor
Senator ST. John here asked Mr. Conkin whether no
anew thai the bank was making money enough To pay
It's running expenses and declare dividends. nc sara
he could tell he did not Keep tho books would
you declare divdcnds unless you bad earned them -
asked Senator ST. John. Witness said he could not
tell he did not examine tho accounts In answer 10
Mr. McKcon he said that he had heard OF the suggcs.
ton OF the Bank superintendent about giving bonds 10
make up the deficiency; hc gave no bonds and made
no attempt TO make NJ the deficiency ~ any case
Mr. j. 5. Carman, OF orange y. j., was next called.
He had been real estate broker In Brooklyn; was
acquainted with the Duilding on the corner OF Prcsi
dent and Van Brunt streets 10 1874 v was worth
$52 500: tho lots could not have been bought and
buildings could have been put there tor that wit
ness would like to buy u now Tor from $4,000 "a
, $ls000
sir J. W. wyckor. a real estate broker OF Brooklyn
also though the buildings were worth $500
The session then adjourned until this morning at ter
o'clock.
, OTHER CHARGES
The same Senate committee 1t - understood, will
take charge OF tho investigation OF the Supcrineu
deut,s the fourteen other banks whfct