National Republican. (Washington City (D.C.)) 1872-1888, 1884-06-03
OIL BROKE THE BANK.
President Riddle Tells the Curious Story Of
His MsfOrtun6s.
His Bank First Lost Money Through
Loans to Spectators.
Then he and His Directors Made Desperate Play
for Even by Specializing Themselves,
And Their Money Slipped Away by the
Millions ms II Creased.

Pt1rsBURe, Juno 2.--Pfssidont Riddle, Of
The Penn bank, made statement to-day,
which has created the most intense excite
mont hore. IL was published In full in the
afternoon papers, and tho demand for extra
copos has been enormous. The statement is
very long. II recites the organization and
early prosperity of the bank briefly, and then
proceeds with the transactions which brought
II into difficulty, which arc stated ut some
length.
"wben oil certificates were offered
rs collateral, he says, this bank was
among the first to accept them.
1t was like every other bank
rich sometimes and poor sometimes. Until
1880 gave 10 all my attention. After that
was sick and away great portion or tho
time, but was there when / could be. The
paper there was as good as the average run of
any other bank. Some time in 1880, also in
$751; IL had money to loan, and in both years
carried large amount Of oil for our brokers.
Some Of it was carried for a year or two;
some maybe less time In 1882
was again sick, and was trying to
get away for rest. At the timo I was ready
to 40 1t was very high, and while the bank
had money to loan gave as much time as l
could to getting these oil accounts, for which
we held collaterals. made up as the price was
high and did not want to see them continue
loans were good. Mr.. Hopkins president;
Mr.. Laughlin, vice president, and Mr.. Reiber,
assistant cashier, relieved me and went
away. 1 told Mr.. Reiber not TO fail to see
that these accounts were made up. l told
Mr.. Laughlin the same, and on my way
south i telegraphed Mr. Reibet and wrote
Mr.. Loughlin again not to fail to see about
It,"
He then tells how, on his return, President
Hopkins resigned and he was induced to take
his place. Every soon," he says, II found
that my directions had not been carried out
as to sundry accounts concerning which /
had stated to Reiber aud Laughlin prior to
my departure south, and in which q. b..
Thompson, J. II. Thompson, w. Haldainan,
II. Moore, and several others figured, and
that loans ran 100000 to 100000 more than
the collateral represented at the then very low
prices. / complained to those whom / had
told to have these accounts made up, and
told them that did not see what could do,
unless l could by personal exertion
get lot Of people to buy enough oil
then, put tho prices up, and
buy enough on the banks account
TO make good these accounts. / told Mr.. Rel
Der and / told part of tho board, namely: L. b.
Laughlin and J. o. Brown, A. M. Cavitt and
Major Swearinger, of my intention and told
all of them that would not then, or at any
other time, buy single barrel for myself. /
had only a wish to make up those accounts. /
went east, and the board knew the nature of
my errand and had a lot of people there to
OF this scheme was tho profit OF
tho bank. / had no Individual in
forest in the venture at all. In May,
1882, very large lot of oil was bought and
the price advanced. In the midst of this
was again taken sick. That was the time
that these accounts named in tho papers as
fictitious accounts were made. Some were
for the gains to 20 to tile bank to make up
these old back accounts; others were for indi-
yiduals who would hope for profit, which
they would divide. Now, thon, | want to say
that these directors did know all about this.
After went to New York to get such parties
as could to buy oil with parties here and in
Oil City, told these directors of the purpose
of my going. They bought oil individually
at times.
One Of the parties that transacted the bust.
ness through me ON individual account, as
the accounts in the bank will show, was Mr..
Hopkins. bought oil for Mr.. II. b. Laughlin,
and with his consent it was put into an nc
count in the bank as IF B. Laughlln No. 81
and still stands there undivided.
Nothing having been said as to where the
profits should go, l also bought oil on his
account The accounts still stand there
charged with loss That is the account
known as "Hill 4 Co." Among other di.
rectors who bought oil upon information
received directly or indirectly from me was
j. o. Brown, on his individual account; NJ.
A. Cavitt, on his individual account, and, /
believe his account still stands overdrawn
for a part of tho amount. A. Anohinson
also bought on his own account; s. SEWERAGE
bought on his own account, but paid for It;
Isaac Van Voorhees,, attorney for the bank,
also bought large amounts on information
received from me. George G. Davis did
buy, or talked of buying, as he
inquired every day as to the prospects both
of myself and Mr.. Reiber. Mr.. Swearingen
talked frequently about these transactions,
and casually inquired how they were getting
along as they passed through on their way to
New York and Oil City, and the accounts
were being charged for handling Mr.. Nc
Mullen also bought large amounts of oil for
himself and myself representing the bank,
he doing it with no special intention for
gain for himself, simply intending to put
there, that it might benefit the bank. and
with this transaction is charged tho account
of ID. Wilson & Co. The account of Watson
q Co was an account made and suggested by
MT. j. Watson himself The benefit of this
account was to go half to one bank for the
use of these old accounts The first transac-
ton was transfer of some oil from Oil City to
this place. through tho accounts, and trans
ters thereafter were made through this
account. When the time came to sell, oil tho
amounts that had passed through this ac-
count were charged against it. The accounts
: Y.
on account Of principal were bought by con-
sent, and mostly by his direction and for my
account in tho bank. He was TO get one-half
and to get one-half toward max Ing up this
account as stated, and to this account he made
sundry checks sundry orders and sundry
notes, but left 1t i'll general way in my
charge. The account of Brown & Co. was
credited at first as money being received
from parties In Philadelphia and part of it
from j. r. Keene. That account stands bal.
anoed, 80 that there is nothing further con-
corning Ii known. The account of j. p.
Beale No. g was first made after all these
other accounts, and In continuation of the
whole to assist in making up these worthless
accounts, and, II any profits were made IL
was not intended that Mr.. Beale should havo
any Of them. Sometime during July, 1888,
1t was found necessary 60 sell not
only great portion of this oil,
but great portion of our customers oil, held
as collateral, and this was done. / told Mr..
Laughlin one day ii was done, and he was
good enough to help mo all he could, told
him that didn't see how l could stand ID
much longer MS my strength was being taxed
seemingly beyond human endurance. Many
OF the individuals who had received informa-
tion to buy at low rates sold at high rates,
and took money to the credit Of their own
accounts. During the tlme this oil
was bought it was currently circulated
40 the exchange that this was only
little pool to mako up some bad accounts at
the Penn bank, and this was the case. Ii
was work enough to have attempted to do