Lancaster daily intelligencer. [volume] (Lancaster, Pa.) 1864-1928, 1884-05-29
ALL BROKEN UP.
rsE rirrsBuRa PENN SANK SMASHED.
Disastrous Coudition OF Affairs HsSesied
by Recent Inycstigstlons-sl,2O 200, 900
,teli,ysd to Have Heen Loaf,

climax on Wednesday afternoon, when 1t
became known that its resources had been
com pletely exhausted by fictitious Dor
rowers and that the prospects are that
hardly enough will be saved from the
wreck to pay The expenses Of wiudiGg up
its affairs. The examination of the books
has led to the discovery that persons, pre-
sumably officials of tho bank or bankers
handling oil for the institution, had, under
the name of firms that have no existence,
overdTawn their accounts at least sl,3ou,
600, and It is feared, when all the indi-
yidual accounts have been examined, that
the showing will be still worse.
Il is now evident that this state OF al.
fairs in the bank has not been of recent
development, bat dates back for NJ least
thres years 10 the time Of tho Cherry
Grove excitement, when the price of oil
fell below 80 cents and banks had great
difficulty in keeping their customers up 70
the line in the matter of margins. The
Penn did not succeed in doing So and this
was the beginning OF that which finally
wrecked it. A gentleman cOnSersaut with
the method Of the bank says
" Had the Penn bauk closed its doors
the lst OF March and wound up its affairs
| doubt whether depositors would have
realized ten per cent on their accounts
IL has been losing money steadily since,
aud will not, believe, realize i've per
cent. under liquidation. 1t has bsen
doing business entirely on false reputa
ton. At the time speak of saw q
transcript Of the account Of prominent
oil speculatur at tho Penn, which showed
an ovcrdraft OF more than SlGO, 900, and
this was not an isolated case, Is To my
certain knowledge there were others.
When cash rau low they adopted the de
vice of margin slips to tide them over, and
q few weeks ago some of the banks were
full Of the evidences of Indebtedness,
which readily had no more value than the
paper upon which they were printed.
Some banks, as the Allegheny UatiOnal for
instance, refused 10 touch these margin
slips, and the others gradually drew away
from them. Out OF the calling by the
Merchants and Manufacturers national
bauk for the cash on ESQ. 900 worth of this
sort of paper grew the stories as TO the
Penu's shakiness, which so excited the
indignation OF MIR. Riddle and others con
nected with the bank and which, perhaps,
was instrumental in precipitating crash,
which must Inevitably have come within
a short time unless prevented b. soma
thing little short of a financial miracle.
Honeycomood from Top to Bottom.
" The whole institution was honey.
combed from top to bottom aud 1t is one
Of tho wonders OF the age that the drain
should have gone on 50 long without dis
c1very by the stockholders. Il was Pres
ideut Riddles habit to publish q STATE ment
Of the condition OF the Penn bank when
ever the national banks made one in re.
spouse 10 the call Of the comptroller of the
currency. Judged by these shOwings the
bank was proceeding on highly prosper
| GUS career, but in the light of facts now
coming out the public can judge accurately
| of the utter WOrthlesSnesS of MS figures.
| Il is the old story over again OF throwing =
| good dollars 10 catch bad ones. Having
| got iCto ditiiculty by IT'S loose business
methods, looser moral expedents were
resOrted 70 TO regain lost money. with the
result of plunging still deeper into diif
Guilty and danger"
The q reCtOgs made an assignment 10
| Henry ward, an experienced inancier
| President Riddle has confessed judgment
in favor Of the directors for 500, 900 and
nearly all his personal property has been
| attached. The cashier, q. l. RsOer, is
under police surveillance.
Criminal proceedings are talked of in
many quarters II they are begun, all the
III 10 VI Jal1 btAuh will Dc lLtANuCu as
defendants The directors have not set
ma ie statement, but it is understood
tba' they do not know who composed the
fictitious firms whose accounts are over
drawn, and that President Riddle aud
Cashier Rsrber have refused TO give any
information on the subject. It is charged
that securities and notes LETT for collection
have been hypolhocated and that $40 OOO
cash reported TO bo on hand when the
| bank closed igs doors has been reduced tC
| 90, 600.
The directors Of the bank who signed
notes individually for the s2S9, 900 obtain.
ed from the associated banks are III al
uupleasan position. They will have &c
pay S12 900 every thirty days, and they
have TO pay this with securieties turned
over to them by the bank as collateral
| The associated banks refused to take these
securities in the first instance and nego
tiatiOus would have ended If it had moi
been for the agreement Of the director.
TO give notes. 4 new complication has
arisen because the attorneys OF some o.
the depOsitors are preparing the paper,
necessary to support a claim that the
| depositors have prior claim on the SO
curities held by the directors and that theJ
are not entitled 70 hold them.