The Iola register. [volume] (Iola, Allen County, Kansas) 1875-1902, 1881-11-11
A So, 400, 900 FAILURE.

A 50, 400, 900 FAILURE.
The Mechanics National Bank Of
Newark. N. j., Ruined by the Opera
lions Of Hts Cashier-His Losses by
Unsecured LOans and SpeculatiOns
Not Far from $4,000. OO0-The Cui.
prit Arrested-Arrest Of an Alleged
AbettOr Of the Embezzlement.
NEW YORK, October 81.
The Mechanics National Bank of Newark,
N. j., closed to-day. The announcement
excited universal surprise and establishment.
The Mechanics Bank has been the
leading financial Institution of Newark for
the past fifty years, and in all that time no
whisper to its discredit had been heard. 1t
was the heaviest bank in the State OF New
Jersey, and its transactions were OF mag
nitude and importance known to no other
suburban bank. The story of the ruin, so far
as it can be given at present, was obtained
from one Of the Directors, gentleman
whose whole fortune is swallowed by the
catastrophe: "Sunday morning." he said, |
oscar L. Baldwin, the Cashier OF the bank, |
sent for Stephen H. Condict, one OF the Di-
rectors, and asked him to call at the bank
building at eleven O'Clock. Mr.. Condict
called at the hour fixed, and Bald
win informed him that the bank
was ruined. 1t seems that the Bank
Examiner, E. p. Shelley, who has been
in town for the past ten days. examining
National Banks, had notified Baldwin
Thursday that the bank would be examined
Monday, and this precipitated the dis
closure. At seven o'clock last evening
meeting of the Directors was held at the
residence of Joseph A. Halsey, in Park
Place, at which there was full attendance.
MIR. Condict told the other Directors what
| Baldwin had said to him, adding that the
shortage of the institution would probably
amount to $1,000, 600 or s2,5O0,oOo. When
the establishment rising from this startling
announcement had subsidized. Mr.. Baldwin
was called before the Board and made .
statement of financial operations for the
past twelve years, such as perhaps has no
parallel in the history of banking. He said
that the whole amount, say -, 100000, had
gone into the hands Of single firm, Messrs.
C. Nugent g. Co., morocco manufacturers,
of Newark, and that he had never benefited
by the defalcation to the amount Of q dollar.
He had loaned money to Nugent & Co. some
twelve years ago, without authority from
the Board of Directors and without the
customary collateral, and had ever since
been irving to cover his tracks. Nugent, &C.
cording to his story, said that he owned val
liable property and would be able to take up
all his notes, provided little time was
given him. Whenever q note became due
Nugent would pay a portion of it and then
give another note and borrow an additional
| = Roll rr0tQSt
ed, but Nugent quickly shut him up by say.
ing: You and I are both in the hole. II
this thing is exposed it will ruin you as well
as me. You have been lending me money
without collateral and without the consent
Of your Board of Directors. Say nothing
about it, and will be able before long to
Dull through Powerless to resist, the I'M
fortunate Cashier continued to advance
money to Nugent & Co. until the amount
became appallingly large. How Mr.. Bald
win kept . knowledge Of these transactions
from the Directors l cannot tell you; but
presume that he used our balance Mt the
, Mechanics Bank of New York for that pur-
nose. We have had an average daily Dat
ance of from ST, SOC, 600 to 1000, 600 at that
5: institution for several years, and 1t was
J, yery easy for our Cashier to make use
:, of it without our knowledge, since he
!. could keep his books in such way as to
). seemingly preserve that balance intact. Be
sides, all of t1s had the most perfect conf
,: dence in his integrity, and knew that ne wa
}, a business man of rare shrewdness and abil.
!. itv. NV theory is tina! when Baldwin found
& himself involved to the amount OF S20o,OC'
or 1890, 900 by his note transactions witt
Wall nn
Is of the banks money. in the hope OF recoup
& ing himself. Bad luck or bad judgmen
}. dragged him deeper and deeper into tn
% mire, and the result was his disclosure o
DI last evening. He told me that every dolla
Is OF the missing money had gone into M
at GENTS business; but this 1 can not believe
ii should have said that the notes given b!
\. Nucept to Baldwin for the money OF tn
h. bank were never seen or heard OF by tn
III Directors. In fact, they knew nothing c
re the transaction. How the Bank Examine
q. was hoodwinked can not say; but at ever
annual examination our bank came out wit
re a clean record. For myself, had such I'm
limited confidence in Baldwin that l neve
y thought of looking very closely into his az
. counts.
e .After bearing Baldwin's statement,
" the Director continued, 1--WE called in Fred
10 erick T. Frelinghuysen IS counsel, and AZ
u pointed Messrs. George A. Halsey and Her
81 nv Howell as committee to visit Washing
" ton and consult with the Comptroller Of II
X. Currency as to the situation of the bank
r. We also appointed Stephen H. COndict an
IN. James F. Bond as a committee to consu
=, John C.. Emory, our counsel. as to the az
visibility of arresting Baldwin. The con
Is. mittee reused Mr.. Emory from his bed. an
N. after a short consultation were advised
r. cause Baldwin's arrest. Early this NOR
~ ing thew called upon A. Q. keasby, Unite
he States District Attorney, and James +. Boz
zee made an affidavit embodying substantial
MI the facts above narrated"
no, Balwin was arrested in bed at seven TT
morning. He showed no surprise, and "
'ns evidently expecting arrest. He said
lie: would not give bail, and he was content
err, pass his life in prison. II shall never
ka. seen on Broad street again" he eXciaime
"When Baldwin was before us, said
I'll dire tor to a reporter, che appeared to
At. anxious to make clean breast OF the ma
has ter. He said he fully realized the grave r
he ture of the offense, and admi ted that
ought to be dealt with in the severest ma
iho ner the law would allow. There is no e
yed cuse for my misdeeds, he said, 'and n
hi tn have