New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1882-05-24
INSURANCE RECEIVERSHIPS.
EVILS OF THE PRESENT SYSTEM.

TIE SHARPE BILL IN THE SENAlE-hhf UNI VI $500
ASSEMBLY coMMIrrEE-sELECrIoN OF INcoM-
PETENr OBSERVATION-DISCLOSURES FEEs-JosliCE
wEsTBRooK SEVERELY CRITICISED.
rFRoM THE REGULAR CORRESPONDENT OF THE rkiBUhh''
ALBANY, May 23.-The receivers of the in
solvent life insurance companies and savings banks nave
been the chief object OF attention OF the present Lesa
ture. Their conduct has rendered necessary tnree
costly esla Investigations during the session. NO"
the last scene nqustion is reached; the invesu
eating committees make their reporand the Legislature
prepares to pass laws to prevent repetition Oh INC
abuses disclosed
In both branches OF the Legislature to-day the receV
ersbps and their treatment the chief SUBJECTS con-
sidered. In the Assembly the special investigating
committee, OF which Mr. Chaplin is tho CHAIRMAN
made its report; while in the Senate the Dill OF e1-
Speaker Sharpe making the State Treasurer " he
ceiver-G General" modified by tho Senate judiciary
Committee was the subject OF debate that lasted Tor
three hours General sharpes bill transfers at once TO
the State Treasurer the remaining assets OF the lnso
vent savings banks and life insurance companies ~
found it chief critics In Senators Covert ana Lansing
The latter charged that the bill in the interest OF
receivers it would take away their responsibility
for mismanang the affairs Of the bankrupt concerns
He limited that there several receivers VINO wond
gladly resign their receivershps having exhausted the
finds in their possession and seeing further chance
OF securing personal profits Senator Covert said That
abuses existed which in decency should De cor
rected But he did think If certain receivers had
been corrupt that the entire system should be swept
away.
Finally, after few unimportant amendments had
been adopted the bill ordered to third reading
Senator H. A. Nelson moved that 1t should be bnmedl
ately passed This required majority OF twOthrds
The motion was lost the vote being 10 to H. Neverthe
ess the vote showed that when the bill comes up for
final passage tomorrow it will pass only seventeen
Affirmative votes will then be required.
The report Of Assembyman ChapiD's committee was
in substance as follows
THE REPORT
ALBANY, May 23.-The story of certain life
insurance companies examined by this committee shows
that during period preceding their insolvency their
management displayed almost every conceivable OBJ
econabe feature and that in place Of harmonious,
herent and progressive legislation there into being
mulitudnOus contradictory and bewilderng laws in &C
cOmplshmcn OF special aims and selfish sometimes sin
ster purposes. The Of financial proHgacy which
swept over land during this period dashed down the
barriers of and honest administration, and
found outlet gross abuses and disgracefu beray OF
sacred trusts Yielding to the current Of speculation
eny,lOpng them officers and directors gave themselves
up to every form of nismanagement and dishonesty.
OF the thirteen companies considered by this commit
tee only one-the Atlantic Mutua-can be seriously
claimed to have been decenty conducted during its de-
cining years. The Others afford spectacular exhibit
htiOn OF varied phases OF Incompetent, INSCRIPTIONS,
Irresponsible and unchecked misconduct In place OF the
simple contract OF life insurance, fantastic diversions III
the nature Of policies introduced. series of ex-
citing dtlusiye plans eliminated IN the unique
ami startling adventure described as the American
Popular Plan" with this latter plan the climax OF
semtheatIca and grOtesq1e effort was attained so
had this course been extended that durlHSa pre
and IN SCRABBLE existence OF these companies had
Issued not less than l35 different forms OF p9hcy Al
the same ingenious ana yaregaied methods OF pay
rcsOrtcd 10 Dy premium hOles loans 10 pVhcg
holders and otner devices cuated 10 fascnate the IN
experienced and confuse the company's finances.
ia the selection OF Investments ana tue disposition OF
the companys funds there prevailed practices similarly
tainted with gregularlty ana traudQeul intent me
management of Continental, the largest ana most
no orOus these organizauons mad departed so far
from all recognized business methods that s history
reads "A ale OF the 1,naSina ion When the nrSt re-
During the Ten years OF is corporate exisie
no examination OF the company was ever made by the
Insurance Department, nor was any examination at
tempted its business had ceased amt It's re-
ceiver MAD appointed Tue discrepancies between
the amount found by the receiver OF tie Amc
can Popular and the amount alleged In Inc coupdhys
report Tor year preceding the receivers appointment
cannot be- explained ON any Ordinary VI CIe'ADlc II!
OF the Universal aud the North America, and the
said that swndler succeeded swindler, company swa
lowed COMPANY nt tue ''t Ie empty cy nI nSs
The Globe had been factor grand real estate spec
niauon Throughout, the Insurance. Department
TO nave been DO weross indifferent IN asserting its
authority projecting the wrOnSed policy holders Inc
management OF tue Atlantic Mutual was declared by the
Court 10 have been economical ana honest but, under
the operation II law o1 strange narshness and OF more
doubtful wisdom, receiver was subsequently ap-
THE CHARGES AGAINST RECEIVERS.
Having thus reviewed tue conditions preceding and
giving rise to receiyersnp management the nature Of
the task upon which receivers entered can be
clearly appreciated Against the receivers themselves,
the charge OF unreasonable and needless delay III the
settlement Of the companies affairs urged This charge
Is III part least we'll grounded. With tue exception
OF one two, of tne receivers have shown any
earnest desire complete their work and 10 DO freed
from IT, 1t is true many OF The circumstances ne
nj fftp ufrnl In
the cO1lutCecs opinion, tue assets Oi the companies
could have been reduced 10 cash, Invested III
OF Inc receivers Oince largely cut down, II not
almost entirely dispensed with, without waiting
mil september ls. -, Unul October 1850, for de-
cIsions court OF Appeals determining how dis
rlDu SHOULD be mad. Leaving OUT oi consideration
those receivers dppOln Inchts 40 not uAe Oack
more years. OF "hOse com Idhes are Oh apso'
ute nsgnncaAce may safely &c 9ad tnat the oners
nave Willingly tolerated. II not cOnnlVed al the cohtlnu
aucc UDtlr lucrative Uiilce.
pcnse OF their administrations Every receiver whose
trust WAS vi any cOnsGe raUe magnitude, aud whose
years, mas main burden Oi MS duties upon
deputy. These deputies are the real rtcelFl is, anu
it IS IRON them that the cOmmit.ee
factory evidence that came To then from the receivers
| Offices. a second species OF expense for when
the receiver is 10 extcn individually responsible
CONSISTS payments Tor COMMISSIONS and iOr personal
ex eLses. IN the OF eceyer Pierson an attempt
was made commissions NOT only npon Wnat-
ever money mad received ana discussed, Dut upon
the amount OF premium notes ana loans upon poilc,es
outstanding AT the .lne Oh ais appointment rms claim
| was UNREASONABLE and disaraceidl
third species OF expense Tor when large degree OF
responsibility Attaches ~ the Receiver individually Is
found Ia salaries tue amounts paid TO AIS
counsel Inc cOlnte are Oh opinion mat CONSIDER
able ,art dOnc cOdIscl and Charged Ior
IA ega services, nignt properly nave been at
zen 10 Receivers oce wltnOut Increasing It's
running expenses. Inc reappearduce OF Tue sahe AZ
tnrrys M CONNECTION with companies Is sug-
p.v, IL Is tnat III a. least one case, ahd
tuat one OF the IOrant, the receiver was ad-
vls. on "A dc Wnat cOunsel To retln No ulrecI teSu-
luouy o. pr. clso character Is gwen IN any OtueI
Instance II may, however, DC IVasoaaDy IhiciIeu au
deliberately sta1., counsel whose names occur
so Ir,uucu,y as tho tresentaVes OF receivers, anu
wuo,, ,er ces are munlucenuy rewarded, owe tner
.rcon III part Judicial favor Inspired by political
! influence. .,
IN. ApOits of all the referees VINO have performed
WORK sucn @ ordinarily wolves upon That class Oi Oh
! A.. ma s.tnle