New-York tribune., 1878-02-16

The Commission call attention 10 Hnanciai
transaction in Chicago which is not without inter-
est to the average pOlicy-holder. loan OF $lOe,-
900 was made to a Mr. Forsythe, of Chicago, upon
which notes secured by mortgage, but without in
terest payable in five years, to the amount of
$1G3COO, being the amount of the loan at COM
pound interest were taken Correspondence was
discovered between agents of the company and the
mortgageor, in which the former asked for tempo
rary exchange OF these nOnnerest bearing for inter
estbcaring notes. in order them in their annual
statement. 1t appeared in the course OF tins IN
quiry that the borrower only receivedS9l 4s5 on the
300 900 loan, the remainder being used up III CON-
missions. The Coardnt, of this city, explains what
il calls in this case the mysterious double set OF
notes." IN this way 1T was at one time decided"
it says, "to substitute q new set OF notes for the
originals, but the purpose was abandoned and some
controversy arising Involving $2,5OO) between the
Chicago agent and FOrsythe, return of the second
set was delaycd-perhaps has not yet been made"
The same paper, of the same date explains the re-
Iations of the company with the Farmers ana
Mechanics Bank in this way:
The late president OF that bank, John c. Tracy who
before his fall had high reputation as an honorable
Continental. He had the full confidence OF the company
OF He used TO keep accounts between tne com
pany the books of the bank Just the condition tat
sniled his operations lie would duly pay checks OF th3
company and keep its pass-book correctly but would
on the banks ledgers giving the company much
larger balance to Its credit than the truth warranted
am very glad to copy this explanation from The
Courdnt For there certain things in the history
of these transactions which, it must be confessed,
have lust the suggestion of possibility that the
officers of the company might have had knowledge
Il will not say guilty knowledge-0f what was
going on between the company and the bank. But
it seems not Tracy had their full confidence. Ho
abused it, as it appears, by letting them draw
money out of the bank, and neglecting to
charge ii to them, thus giving tho company
much larger balance to its credit than the
truth warranted" / scarcely need repeat that
Tracy is the bad man of the period, nor
to point out how fortunate the company which he
has abused in this way is in the fact that he Is now
in the State Prison. Until The COurGRt made this
explanation there a shade of suspicion resting
upon the company's officers but that journal has so
far entitled itself to the thanks ana the confidence OF
the community by its noble disinterestedncss III
behalf Of the Charter Oak policy-hoders against
the Vaccinations of Marshall Jewell that 70 one
will hesitate now to trust its explanation of the
Coutinental's embarrassments, that Tracy did it
all.
Another matter which was brought out the other
dav in the hearing before the Insurance Committee
of the Legislature, with suddenness, may be
mentioned here and credited, presume to Tracy
Mr. Wilson, the Secretary of tho Special Commits
sion, testified that during the first part of the term
he was engaged in examining the companys books.
He occupied the company office. and left his papers
there at night HIS attention being attracted one
day to singular discrepancy III the figures he was
led to a careful determination, which disclosed al
teratons in the figures affecting the condition OF the
company fayorably to the amount of $4,000: The
changes were made by prefxng the figure to n line
of figures so as to add 81 900 to the amount III each
instance This change was made in sixteen III
stances; in one case the prefix was =, making an
aggregate of SIS 900. The added figures in a
different cOlored ink from the original and the at
tempted fr- tut-tut-I had almost said fraud
the attempted alteration, let call its quite plain
and unmistakable. All the officers of the company.
and some of the bookkecpers testify that they never
knew of any change being made. or of Mr. Wilson's
papers being tampered with while they were in
the Office They say, too, that it would have been
an absurd and ridiculous thing 10 do to have made
alterations amounting only to $4,000, which could
not have done them any good, since they made
showing Of $500 900 surplus. The Commissioners
on tho other hand say that under the tests that they
were applying to assets, they had no such sur
plus and tho officers OF the company were very
well aware that they needed to make
the best showing possible to keep their
heads above water IL seems to me that this was a
clear case of Tracy. can account for it no other
way believe that he in prison at the time,
bnt am not certain. give the company the ben
eft Of the doubt Anyway 1t makes no difference.
After practcing as he did upon the credulity and
innocence of these Continental officers, by cashng
their checks when they had no funds, am pre-
pared to believe anything of him. The testimony
regarding this transaction brought out before
| the committee. somewhat TO the surprise of the
companys officers. there having been no reference
10 il in the report of the Commission to the Legisi-
ture. In answer to question, the attorney for the
Commission said il was withheld out of kindness to
the company. presume it was finally brought out
because Of the waspshness with which the COM
many had conducted its defence | think detect IN
il the flavor Of our common human nature. / can
not see yet that it hurts any body-always except
ing Tracy.
Before the conclusion of tho Legislative commit
tees hearing, Judge Nathaniel Sherman, of the
United States District Court. who Is poicy-hoder,
addressed the committee on behalf OF the policy
holders. urging change In the management OF the
| company the old management having, as he said,
forfeited the confidence of the public. With this
end in view, he proposed an amendment to tho
charter providing for a board of directors, ten
in numbers; six to be appointed by the
Governor and four to be chosen by the policy
holders. This would be substantially The IRIB-
UNE plan. making the Continental practically
Mutual company. Judge Shipman presided at the
trial of Mr.. Tracy, and upon the rendering of YER
dict of guilty sentenced him to tho full extent of
the law, Notwithstanding the appeals made for len
iency on account Of the previous character and
standing of the cuprit. He subsequently refused
to comply with the request of certain influential
persons that Tracy be confined in the Hart
ford Jail, where he could be consulted In set
Ting up tho transactions of the bank
and the insurance company which 1t was
thought but he could explain. He mani
Lol; IN, lao a