Belmont chronicle. [volume] (St. Clairsville, Ohio) 1855-1973, 1881-11-10
TRUSTED TOO MUCH.


TRUSTED TOO MUCH.
The defalcation in the Mechanics Ma
tional Bank of Newark, by which, ac-
cording to the statement of the default-
er himself, S2,00O,OO0 an amount equiv
alent to five-sixths of the whole amount
of deposits stolen from the bank,
must rank among the most extraordi-
nary financial crimes of recent times.
Contemporary history, at all events,
shows no parallel 10 it. The bank seems
to have been fairly mined out. The di-
rectOrs enter and find walls of barren
stone, with the ore gone. All the busi-
ness of the institution was practically
centred in tue hands of the cashier,
Baldwin. He was trusted, trusted abso-
lutely, and the officers and directors alb
dicated their functions in his favor. For
eight years he carried on an elaborate
system of false entries, false reports and
false correspondence, by which he es-
capped detection, and pursued his robber-
les undisturbed. He WAS even able to
deceive and outwit the National Bank |
examiners. At last the day came when
the meshes he had been weaving about
himself all these years caught him fast. |
The fraud was well maintained The
very last report of the bank purportedi l
to show S1,400,O0O on deposit with cor
respondent banks in New York, when,s
in fact the bank had nothing here, and
was in debt 100000. Since the failure.l
of the Glasgow Bank there has been no I
such disclosure as this, and this, while
much less important in amount, is far
more dramatic revelation of rascality.
The Mechanics Bank had enjoyed
great confidence, not only because of the
wealth Of men interested in it, but be-
cause this cashier and virtual manager
had been peculiarly trusted, and was
considered man of the highest integri-
ty and of ample wealth. The bank had
the deposits of well-known and rich in
surance and manufacturing establish
ments, and of some public officers, and
its failure may cause not little hard
ship to many individuals beyond the
few who may be seriously involved. 1t
is thought that all the direct advances to
the bank by New York banks were coy-
cred by securities deposited as collater-
ais. but some scattered losses will doubt
ess. be sustained through the exchanges.
In short, the conduct of one man has
,nce more brought great disaster to net
! few persons and firms of good repute,
md losses Of more or less importance to
many thousands, s.saiiz9s 8 5sss,ls
r Can it be fairly said that one man
)nly is responsible for all this misfor-
June? There were other officers of the /,
bank. They were men of wealth and .
high standing. Great confidence was
placed in the bank in part because it
VAS believed, with reason, that men of
'uch reputation and means would not
'nffer great institution to be unwisely
conducted. Yet it is now shown that
he management had for years been left I
10 largely to Mr.. Baldwin, the cashier,
hat his power to do mischief was prac- r
ically unlimited. If this is so, are not !:
he other officers blamewortby True,
he cashier was man of the highest re- '
pectability; but it is not the theory of L
he National Banking act, nor the ex- 9
of the public that the vast in !,
erests In charge of such bank shall be
ntrusted to any one man. Have not de- Q
'ositors and other creditors, a right to t
sk, with some Indignation, why the re- n
pectable and distinguished directors
ontinued to hold their seats, if they did
lot practically exercise that watchful- a
less and control which creditors expect il
d from them? n
The first report that the cashier had ],
'een operating heavily in Wall Street :,
loes not agree with his own statement. 7
This is, that the money stolen has been =
lsed to sustain the speculations of a !.
leather firm. The head of y
he firm was arrested last night. 1t re- 8
mains to be seen how far this statement =
nay be correct. 1t could well be wished .
hat the rumor could prove true which :,
ays that Baldwin's mind has become y
lnhinged, and that his accusations of ?,
himself are exaggerated. But the de-. y
ails OF the evidence do not seem to ad- !
Iit of any such happy conclusion. What =
ver the amount of the defalcation, =
Iowever. there is need of some reform q
n methods of corporate management,
or all experience has taught that un-
limited confidence is apt to cause un-
limited mischief.-N. Y. Tribune, No
'ember /.