The sun. [volume] (New York [N.Y.]) 1833-1916, 1879-02-24
FRED. A. FREEMAN ARRESTED
ACCUSED or TAKING A SHdRE OF THE
GUARDIAN MUTUAL CASH


bail that the order OF arrest issued by Judge
Donohuc called for. Mr.. Freeman is charged.
in connection with Sheppard Romans. An
drew W. Gill. and others. with conspiracy to
unlawfully appropriate $3.50 600 that belonged
10 the Guardian Mutual Life Insurance Com
pany. Mr. Freeman is one Of family that has
been tho controlling influence in several insur-
ance companies. His father. Pliny Freeman.
was tho first President OF the Globe Mutual.
and James NJ. Freeman. ono OF tho sons. was
Secretary Recently Frederick A. Freeman was
made an officer in tho Globe. md II has been
said in insurance circles that tho Freeman
family controlled this company. Frederick A..
some years ago carried two insurance companies
| upon his shoulders. lie was President Of the
unfortunate widows and Orphans. and Sccre-
tary OF the equally unfortunate Reserve Mu-
tual. Sheppard Romans. who for years has
| been prominent figure In insurance compa-
nics was n trustee Of the widows and Orphans
when Mr.. Freeman was tho President. At this
| time the Guardian Mutual was also believed to
be in r nourishing condition. A. w. Gill was
| President and Mr.. Clapp President. An
| other officer was Mr.. Holbrook. These are the
| persons who arc charged with exchanging
t250.0O0 Of poor securities for t250.OO0 OF tho
| Guardians good money. and dividing the sum
| thus obtained nmong themselves.
| When the Guardian Company went into the
! nan1S OF henry IL. IltfSOu rs receiver ne lnnud
| among the assets block OF comparatively
| worthless Reserve Mutual Life Insurance Com
pan, sdtock; which had come into y, pGssession
| had been changes about this time in the man
agemrnt Of the Guardian. widows and
| commented on by insurance men ma rcmarkn-
BILE and h" thought there might he some con-
| nectipn between these changes and the placing
of 1882 600 Of poor securities among tho
| Guardian assets. Following up this idea. MIR.
| pierson appears t. have satisfied himself that
| his stIapirfDu correct for tnR OF Mr.
| Freeman md the suit against him and the
other officials are based upon the result ot his
| investigation. Mr.. Freeman Is to loo required
70 furnish bail in 100000 because 1t is he
licved that q Judgment against him could he
the prisoner is supposed to be- in tho custody Of
DEPUTY Sheriff McGonigal. to be produced in
Mr. Pcrson. in the affidavit upon which tho
order of arrest was granted afilrms that Mr.
phuns Mr., Romans. rs trustee OF the snme ;
Mr.. Gin. rs President: Mr.. Clnpp, ns Vice Pres
ident and Mr.; Holorook as AN officer Of the
ranged and consummRted the following plan:
II was agreed that On, and Clamp, should b.
and Reserve Mutual Gill was 10 be- elected
President Of the Widows and Orphans and
Chpp President " the Reserve, while Ilolbrook
was 10 be- elected Secretary OF both companies.
Then controlling interest in the Reserve Mu-
and Hohrook. and 1852 900 Of this stock bought
by the Guardian NJ par. for cash. Tho Reserve
n carry out the scheme Freernnn resigned the
Presidency Of the Widows nni Orphans and
Secretaryship 81 tho Reserve Mutual Tho Sec.
rotary Of the widows and Orphans also re-
signed. Their places wore immediately hlled
"f5 ssa s by en- a Gnp AMI h9's sot
cnme into tho possession ~ these mon.
Thus tho officers Of the Guardian. who
phans' and Reserve Mutual we're in the way Of
| Transferring the good assets NJ tho former "a
almost worthless stock 81 the latter company.
This was one of the blows that ruined the
Guardian. II Is said.
After freeman quit the Widows and ORPHANS
he took an interest IN his fathers and brother's
company. the Globe Mutual He went to Eng
land aud tried there to establish an agency for
| the company. hut without success. Since then
| b" has ind more W less 20 do with the com pany.
| ana last July. ON N" suggestion ~ Sup"rint"n-
| dent SMITH. lis brother James resi- urd tho
s"cr'inrysllip AMI Frederick took his place. On
| Saturday Tue SUN announced that Attorney
General hoonmaEer was about ~ TAX" stops
Tor the removal Of som" II the on '"rs % tho
Giobe, and IL Is believed tho men are james
VI. Freeman aud Pliny Freeman. Ii has
transpr.d recently that Deputy Commis-
sioner VI 'Call. in q report made in May
mont ccniJ r. .yr.ctnI a., ,,", o,Ilc.ysp wbo
loaned si2OOOO on flO4 900 of the Widows aud
Orphans Compauy's stock. when that company
must have h'rn known 10 b. in had shape. Mr..
| Mccall tntimntes that this loan WAS nude to
enable the son OF the President ot the Globe 10
control the Widows and ORPHANS. which he
did long enough 10 ruin IT, He adds that tue
trusts reposed IN inc otlicers ol me Globe
were wilfully and shamefully abused to their
| own hffunlNfN i"'nfUls anu 10 inc great INJURY
1864 were but 81 OOG. while only six years later
asserts that the hooks have been altered, and
that nearly $500 600 paid to officers and agents
~ salaries and commissions appeared on tho
books as surrender values paid TO policy hold
crs. President Freeman and his son. Secretary
Freeman. the report alilrms. overdrew in 1873
loans OF the company Mr.. Mccall says. present
record 10 he thoroughly condemned. Tnero
IL n loan OF tl2ONO on properly valued nj
flOsOOO: "A loan Of $4,000 on the Brooklyn
Thompson Avenue congregational Church
Of $50 900 made hv the Prrsilent's SON on prop
erty valued nj SIS Oo0; and $50 OO0 loaned on
Egyptian Hall in Ihiry-fourth street. besides "a
valued at &55 600.
Mr.. NJ 'Cail calls attention to n trick that no
says served To- make good showing IN the re-.
port Piiny Freeman. the President turned
over 20 the company good mortsaE" for sl20-
900. long enough To swell the assets, and then
ia" company mHde it over to HIM again. inter-
"a" report had been sworn 10. On some New
morirae. tir $50 900 tho irst mortgage being
Tor $50 900. and the property worth t7J 900.
WIZ ,ne Frn,panis anh IN no6 ~ ,.
loaned on a mortgage. when tho valuation
would have only authorized u much smaller
| sun One 81 the things mentioned was lonn
OF tl5uOO TO a son of John Van Nest OF the III
nnncr Committee. aud "A subsequent loan OF
t.OuO Tor the purpose oi giving him the money
10 pny the interest on the first loan, sixty
thousand dollars was lounrd on the bonds oi
the Long Island CITY Shore Railroad Company.
of winch Mr. freeman WAS Pres dent. and sub
sruu"nuy $4,000 WAS advanced 10 james VI.
Freemrn. without security liz was afterwnrd
credited with tho amount. and IL WINS loaned
tire" days Att"r this credit To W"y Co.. con-
tractors. Mr.. Mccall asserts thnt the annual
statements have been more or less falstrd
since 1870. and that all sorts Of shifts were made
for TIA" purpose Of showing available assets in
the reports. In 1871 the "Xpenses were ilO9.
600 greater than the receipts. Mr.. Mccall re-
CARDS the TACT that the stockholders have drawn
fl3G0OO in dividends on an investment of ilOO.-
600 MS signl tirunt. and cites the fact that only
iiNe Of the thirteen directors arclinsured in the
company,
In view Of the facts. Mr.. Mccall believed that
there should be "A change in the management.
President Frceman's son John resigned tho
Secrrtnryshp. and his son Frederick assumed
the duties. 1t IN not the intention To uut the
Mr. Mccall says that unless there is "A change IN
the management that step must certainly bd
taken.
a Thief Among the Soldiers.