The New York herald., 1878-01-16
ANOTHER COMPANY INVOLVED.
REPORT OF coNNEcrIcUT's sp ECIAL INSURANCE
COMMISSION ON THE CONTINENTAL LIFE, OF
HARTFORD.


COMMISSION ON THE CONTINENTAL LIFE, OF
HARTFORD.
HARTFORD, Conn, Jan. Is. 1878.
Rumors have been quietly circulated for some days
pas, that ali not right with the Continental Lie
Insurance Company, OF this city. These seconded
to-day by exna ausve report TO tho Leaislature by
the special insurance commission, which alleges
mahy ana serious Irregularities and illustrates the
financial jurgery adopted In tho preparation OF
annual statements. On December 81, 1876, the
company reported surplus OF $685. 656 55.
THIS amount Is subject to deductions, according
to the views OF the commission, which more than
sweep away this surplus Tho company reported
$2000o0 United States bonds hand, in which II had
DO valid title, $35, 900 OF town bonds never owned at
ail. Sl73 5l6 90 cash bank when thero such
amount OF genuine dcposits These were reported as
assets through coanivance with tho Farmers and
Mechancs' Banks President John q. Tracy, who was
director in tho company and Is now In State Prison
for deialcaton- Tracy would enter tho company's
bank book items US genuine deposits when deposits
were made. The company merely deposited with
Tracy representations OF cash, but the bank received
nothing nnd gave no credits on It's books, although
credits were gwen by Tracy In tho comIany's pass
book, indicating real deposits.
PECULIAR BOOKKEEPING.
The historyoi some OF these so-cal cd deposits Is
singular. lhe company bought i,U7U shares vi It's
stock ior $l254s2, and 1t stood In the name OF
Tracy trustee, while the vouchers Tor the payment
ui the sum we're treated cnsn item la The CON-
rany cash account. II is obvious that vouchers
were OF TO value asset The Sharp'5 Rife Com
pany borrowed from the Continental S133 53i 90 and
mis- was carried In the company's looks cash on
hand and az times us deposit IN baGk, through
nvance with Tracy. The company has annually
ported It's capital Ssoo,o0o pad up, whereas. In
iact. only $l20, 0O0 VIA paid, and the balance
represented only by slockholders' notes, the
existence OF which was wholly ignored IN the
annual statements. These notes were kept IN
separate package, and frequently passed
TO and fro as cash between the company and stho
bank, although never discounted by the lat,or. The
purchase Of It's stock by the company exhausted
leaves the assets IN tho same condition tney would
have been II tho entire STOCK wholly unpaid Tor
UNRELIABLE STATEMENTS
The Commissioners aege that the annual state
winch represented by assets D! uncertain or 20
value. Oi this amount S133, 53l Is account OF tho
Shurp's Rifle Company, aud there Is also orlgage
debt against that company OF $62, 500, payment OF
us business 1t Is further found that
the real estate is over appraised Sl3S379,
manly OF property 10 nnd near Chicago
and upon the mortgages OF the Union Cemeu. Cou-
The financial troubles OF the Farmers ana Mccasnics
Bank or Hartford nave resulted IN S2l,9 loss
through the depreciation oil stock owned by the
pany.
Taking all the accounts there s an apparent impair
ment Of the Contuentas capital oil $l4S 50l and tho
only Offset offered IL computation ny D. r. Fsokler,
New York ~ surance expert, that the recupcraton
Dor 1877. WILL aggregate SlS20Oo. Even allowing
this would only give surplus VI $G3 400 tcad oil
tho 1925 000 reported by tho company. In conclusion
the Commissioners hcsitato 20 declare the Company
and dnaucal legordenAin to Legislature Tor
its consideration.