New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1890-01-31
A NATIONAL BANK CLOSED.
Continued from First Page.

Continued from First Page.
out of the hands of Charles II. Leland ana put
1t into the hands of men comparatively unknown
A. E. Colsen, the cashier of the bank is respon-
sible for the exposure of the scheme OF the new
ARRANGEMENT, and it was his quick perception
that there was something wrong which put the
bank into the hands of the United States Bank
Examiner.
Mr. Hepburn reached the bank on Wednesday
and demanded from Claassen the securities whlch
should have been in the banks vaults. An eX-
animation showed that S622,OOO OF securities
some Of the best in the market were missing.
The new president of the bank gave as his eN-
planation of the reason why the securities were
NOT in the bank that they had been placed in
the hands of Pell & Wallack. The securities
consist of railroad and other bonds and stocks
which could be sold in open market for at least
$500. 900. Mr. Hepburn demanded their i'm.
mediate return to the bank and the president
said that he would go with him to Pell d Wal
lacks office and get them.
THE SECURITIES SCATTERED.
Together they went down TO Wall-st and there
Afr Hepburn found that a large amount of the
securities had already been sent out for SAFE
George II. Pell, the head of the firm, told him
more brokers to be sold for his firm for the Sixth
National Bank They still had on hand out OF
the $500. 900 of the securities taken from the
banks vaults only $2Ol 900 Mr.. Hepburns
demand for the remainder was met by n
nromise on the part of Pell to have
them at the Sixth National Bank at noon
yesterday OF their money equivalent. CnecKs,
some certified and others not were also onerco
TO the examiner in lieu of the balance In the
value Of the securities taken. The examiner
would not accept the checks and returned 10 the
bank, after telling Claassen that the bank would
be closed and in his hands until the securities OF
their value had been returned to its SAFE lie
waited at the bank yesterday for the new Board
Of Directors or their president to bring the money
or the securities until midday, but none OF theni
went near the institution; neither was anything
heard from Pell & Wallack during the day ?,
The checks which Claassen offered TO Mr. Hep
burn in return for the missing securl'leS were DIS
follows:
Pen waack the Third Ns st sln Bank S SSo
Zen waaes ON che ts9GS M $1,000
James A. Simmons. the EQUITABLE Bank 90 0 090
lanes lanes Ssmmons on on ' the Commercial Ban
James A., simmons on the American Loan ana o. 600
,eo aISs n Pe Co.. on the ST. Nicholas 10000
j Satterlee Co. on the Equitable Bank 10000
The total amount of these checks is $3.50, OoO at
least $4,000 less than the market value OF the
missing securities
Under ordinary circumstances these checks
might have been accepted. But Mr. Hepburn
had before this begun to suspect that all was
not right with the new management Of the banks
He had learned that some of the directors who
succeeded those who served under Mr.. Leland,
were also officers directors in the LenoA hln
and the Equitable banks, and 1t looked 10 MN
as though an attempt was being MADE 10 nave
one dollar count for three. lie therefore held
firmly to his first demand, that either the Sc
curites or the cash must be at the oMth Ma
tional Bank by noon yesterday. $50 =,
He even went SO far as TO offer to go with Mr.
Pell to the Offices of the dozen or more brokers
who according TO him, had the securities ana gGe
would be unnecessary and that the money OF toS
securities would be hand by the hour named
They were not and shortly after noon MI.
Hepburn gave out the following statement of the
affairs of the bank, as he then knew of them:
Mr.. Leland sold l,O35 shares of stock, con-
trolling interest, to the parties at present IN con-
troll of the bank, at $50, and gave them pos
session January %. January 20 S622,OOO Fai
value of high-priced bonds belonging to the bank
were delivered to Pell q Wallack, ana receipt
Received, New-York, January 30, 1890 OF
the Sixth National Bank of New-fork, the follow,
ing named bonds to be sold for account Oh sa no
bank and accounted for to its president, as he
may demand. .~,, ~, .be books Of the bank
10 show any disposition OF the bonds Inc sIoci
book called for the original amount l louhu
the S622 900 bonds gone, and demanded uheIf
restoration or funds to represent their market
value. Dill O. Uo1lool
who said about $500, 900 of the bonds had peeh
SON and checks sent to the bank, ana ShaU the
remaining bonds were with dlnereht pIoheiS nUi
sale, and they would get and return them I1ey
hron chit TO me S201 900 the checks onered LOT Ihc
balance could not be accepted: The ABOVE, 10
gether with other matters anecuhg Vhe IAN I'M
rendered the temporary closing of the bank I'M
lucrative If the gentlemen In charge carry ouV
the promises or assurances gwen yeSteluSSi wy
Controlr will undoubtedly reopen Ilie nanh' .ba
do not think depositors Will lose ahythhg thee
object in taBeing possession was 70 insure V""V'
TWO WARRANTS ISSUED.
Shortly after this he went downtown and with
r d. Tapuan president of the Gallatin Bank, had
a Iong consultation with Assistant United States
District-Attorney Rose and Commissioners Shields.
District-Attorney Mitchell was in Washington'
The facts already made public as to the method IN
which the purchasers obtained control of the
Sixth National Bank were laid before the oniclals'
The sections of the National Banking law were
consulted, especially Section 300 OF the revised
Statutes which makes IL a crime PunlShaD.e Dy
Imprisonment for from five to ten years 1Or
nrfsident or other officer of q National bank to
embezzle abstract wilfully mlsapply any OF the
money. funds or credits of the bank with the
iutent to defraud. Every person who aids any
officer of a bank to violate this law is liable TO
the same punishment. The section IS the one
under which James ID. Fish was indicted ana
convicted. A complaint In accordance WIN the
facts was drawn up by Mr.. Rose and signed by
the Rank Examiner. United States Marshal ia
cobus was called into Mr. Roses room where the
: conference was held. Commissioner Shields
made out warrants for the arrest of President
CIaassen and George II. Pell, and about o'clock
they were given to Marshal Jacobus.
The Marshal put them in his pocket and hur-
ried around TO his Office where by his orders, sew
eral deputy-marsbals were waiting for him. lie
called Chief-Deputy Kennedy and Deputy Freder-
ick Bernhardt and they went out OF the building
with him after most Of the other deputy-marShals
had been sent 10 their homes
Mr. Hepburn and Mr.; Tappan soon left the
building. Mr.. Tappan, before going away rom
the Observation-Disclosures Office said that the investl-
CATION which had been made. showed that the
purchasers of the stock of the Sixth National
Bank had paid for it in checks on other hanks
-. aa.4iGad nnd nc coon tho nurchnsnrs had