The daily gazette. [volume] (Wilmington, Del.) 1874-1883, 1881-11-05
SECOND EDITION
THE RUINED NEWARK BANK.
How the Comptroller was Warned
of its Condition Two Years Ago.

How the Comptroller was Warned
of its Condition Two Years Ago.
New facts of interest and of more
or less importance are told about the
broken Newark bank every day. 1t
was whispered yesterday that William
A. Squier informed the Comptroller
of the Currency two years ago that the
bank was probably unsornd. A re-
porter found Mr.. Squier at his place of
business, No. go River street. He
was clerk in the bank several years
ago, and held some of its stock as late
as 1870. He and Cashier Baldwin have
not been on friendly terms.
eyes, l warned Comptroller Knox,"
said Mr.. Squier. at was in May,
1877. My suspicion was excited by
several facts. / knew the bank had
lent Camp & Osborn 100000 and
Harvey Halsey $50, 600. l knew, also,
that Nugent Sc Co. were being helped
by the bank. And there was the
Dovell matter, r. Dovell's Sons failed,
and the Mechanics Bank and two
other creditors, by sharp practice, got
IN ahead of other creditors. Halstead
G. Burnett took the business as agent
for the bank. Baldwin virtually ran
the establishment and lost money.
knew Nugent & Co. were not making
| anything, and felt certain there was
another leakage for the bank there. l
knew Baldwin was selling Nugent's
notes. AS a stockholder in the bank
/ requested the Comptroller to make
| anoaial ay inc atinn He tx>
keep my correspondence with him
secret. but this was not done. l have
had friendly talk with Baldwin this
year, in the course of which he said |
had not dealt fairly by him in writing
to the Comptroller. He said that
when the examiner came to the bank
he saw the man was suspicious, and
succeeded in getting from him the
facts that | sent to Washington. The
examiner drew from his pocket my
letters to the Comptroller, and let
Baldwin read them. Ofcourse he was
told that | was an enemy to Baldwin,
and was hoodwinked. The cashiers
| irregular transactions with Nugent
would have then been discovered, l
believe, had not Baldwin found out
what the examiner was specially in.
structed to look into. On Monday
last l wrote to Comptroller Knox,
and expressed the opinion that as /
had first informed him of the banks
condition he ought to appoint me re-
ceiver."
Lewis G. Grover, one Of the direc-
tors Of the Newark bank, is President
| of the Mutual Benefit Life Insurance
Company, which has between $500, 900
and 5000, 600 among the deposits of
the Mechanics Bank, OF which $780,
900 was special deposit drawing 81
per cent. interest. In a long interview
with Tribune reporter Mr.. Grover
made a statement of the connection of
the institution of which he is Presi-
| dent with the Mechanics Bank. Pre-.
vious to last May the deposits of the
Mutual Benefit were kept in the Me.
| chanics' Bank. Cashier Baldwin was
a director of the Mutual Benefit, and
from his intimate associations with
the institution aud its officers, has
been frequently entrusted with the
transaction of the financial business of
the company. The deposits of the
company occasionally ran up to very
high figure, reaching above 81, 200, 900
and 81, 100000 These deposits would
again be reduced. Theodore Mackart,
who, as President of the National
State Bank, had brought that institu.
tion out of difficulty precipitated by
undue accommodations to Bathgate s.
Son, of Newark, involving a loss to
the bank of $50, 600, was selected as a
good man for Treasurer of the Mutual
Benefit and was elected. Some time
after his election the question of divid-
ing the deposits between two or more
banks were mooted and a meeting was
called of directors for that purpose.
Oscar Baldwin, as director, opposed
the project, but when it was proposed
to make four banks of deposit he
agreed to division of deposits be-
tween two. The amount of deposits
OF the company then with the Mechan-
million dollars. This meeting was hold
last May. At that time there was not
the slightest suspicion of Baldwin or
of the unsoundness of the bank. The
measure was purely one of precaution,
the result of the business instincts of
the new treasurer.
"There is some misapprehensiop,"
continued Mr.. Grover, "about the real
character of the loss. There must be
assets. There ought to be about ST.
800, 900 of bills receivable, Or there
abouts, to repay depositors. There is
$500, 900 which the law exacts from
stockholders then the bank property
is worth $100,0 900, although the valua-
ton, an extremely low one, is $25, 600.