New-York tribune., 1891-05-22
onEER BROKERAGE WAYS
r,1x .Rorr sATTERLEE. BoSTwICK &
MARTIN.

v,,rrrRE SAID TO HAVE BEEN CAUSED
nv prfr,r1AR PRACTIcEs-wHERE ARE
rxo MEMBERS OF THE FIRMf
ss insurance men have known that
fsr e'' sat,erlee Bostwick & Martin. insurance
sN n' =. No IS Cedar-st, ives in trouble, and
.. nc. surprised when the announcement Of the
..,urut al the Arm came on Tuesday. The sub
s.a~,t publcstion that failure alone was not tho
- os,.e on the firms trouble did not create any
s-,-nrse. II hAs been an open secret for some time
=, Insurance circles that tine firm was not m the
,s possible condition, and number Of firms thereby
ansred TO be saved from loss by withdrawing their
business In time a.
onrn charges row have been made that the firm
has been nisapproprating the funds Of railroad ana
Insurance companies with which it did business ana
sfe amount Of its indebtedness on this account Is
.laced at slsO,oO0 The failure. it is declared. was
the result OF a continuation Of this system OF ms
appropriation and stock speculation. and two OF the
members Of the firm, Livingston satteriee ana Ira
Kingsley Martin, cannot be found and the thiro mem
her Charles s. BoetwicS is broken down coHpieVep
fom shock
rSe firm of satterlee Bostwick Martin has been
An the INSURANCE. brokerage business Tor nuinoer "
y.a- Far,y in its history II made specaiy VI
r,rcaS insurance and in connection with the oneeh
Commercial Union, Liverpool London ana oioDe' alu
fse Royal insurance companies among WHICH u
Arm distributed It's business once had contoi OF e
Insurance of 100000 900 worth Of railroad properly
-. .~,- yaars aao other brokers began 10 make in
.ax on ths business and took about SIOoOO'OOo
N railroad insurance from the tirm Ot It's remain
ing $50 600 OOo the Northern Pacific Railroad OOui
many represented about si4,OooOOO II was ueclalou
yesterday that Messrs Martin and satteriee aI1ehpten
~ keen me- their incomes after business began To IAN
OF by speculation in Wall Street. They own es'@0-
nsmenrs on staten Island and live in excellent sV 70.
and IL Is rrmored that considerable money "as w''
in Wall street. Business fell of so that IN Iooo ono
firm controlled only the insurances OF Ohe N0'
Pacific te Erie the Baltimore and ONO paris U ene
Pennsylvania and Reading, and one or '"o "Ni''
roads In the South. .no
The orcers N these railroads whose insurance the
firm handled merely drew their checks for the enle
smount of the fnsranoes as they were due ana dno
satterlce Bostwick d Martin to make the pay yneh0s
TO insurance companies. When losses were colec'eu
this firm acted for the railroads. and ts nan LAC uo
of the checks both ways.
II WAS not until December, 1890 that there was
arv suspicion of wrong. Then several OF the IN
surance companies which had taken risks on the
Northern Pacific property informed James B. Will
Iarns of the company, who looked after Its insur-
anceS that premiums amounting 10 $4,000 were due
Mr. Williams replied that $4,000 from losses was
due the Northern Pacific from the London, Liverpool
and Globe Insurance Company, and when this amount
could be collected the premiums would be paid IN
outry then made and it was learned that some
satterlee Bostw1ck Martin a check for the amount
of the fire losses TO the railroad company.
Then there exposure OF the firm, which had
been giving the officials Of the railroad company the
impression that technical difficulties stood in the way
Of making the collection from the Insurance company.
There was meeting of the directors Of the railroad
company. and the insurance brokers were called upon
for an explanation. Inasmuch as the brokers turned
10 the railroad real estate enough 70 prevent
actual loss. it was agreed that the missDpropna1on
Of the funds should be kept secret, II the brokers
made the amount good. Right on top Of the tenn
pOrary settlement of this difficulty came the notice
that the insurance from losses policies written by
the Greenwich Fire Insurance Company and amount
Ing TO $40 900, which the brokers collected had
Lot been turned IN TO the railroad company. There
then another consultation and the brokers were
compelled to add this TO the $4,000 previously
discovered.
1t is said that two Of the members Of the firm then
bean using money which collected from premiums
and losses ard In speculating in hopes of getting back
the money that previously had been lost. Then the
failure and it is reported generally in insurance
circles that the firms debts win amount to not less
than S150,000.
Little or no sympathy for the members of the firm,
with the exception Of Mr.. BOstwck is found in insur
ance circles. On the contrary, both Martin and SAT-
terlee come IN for much criticism. Martin.
peciaIy, is condemned. and held mainly responsible
for the trouble 1t said yesterday that when bids
on railroad nsuranoes asked for this firm would
come forward with original proposition, the re
suit Of which would be conference with the officials
who had the giving of the Insurance. and this generally
meant that the brokers got the insurance. Another
broker said that It another custom of this com
pany TO get railroad insurance through other brokers
FOR year. and then at the expiration of this time deal
directly with the railroads.
Besides the four companies named, the firm had
dealings with the Lancashire, Phoenix, Mutual
Assurance and the orient companies. Most of
these companies win lose by the failure. The
brokers were special agents for the Royal In
surance Company and wrote policies in its name
II known what the amount Of these policies are,
but the company viii have 20 stand by them. The
loss TO the Lancashire company said yesterday by
Mr. Pritchard, the assistant manager, to be small.
None OF the officials of the other insurance companies
which understood 20 lose by the failure Of the
railroads whose insurance business looked after by
satterlee Bostwick Martin, would talk with reporters
the failure.
Mr. Martin a stock broker years ago, before he
Abram COddington the assignee Of the firm, was
all alone yesterday az the ONCE, No. So Cedar-st He
apparently was greatly surprised at the exposures
but he declared that he knew nothing about them He
added that he had neither seen nor heard from either
II was rumored yesterday that R. G. Dun & Co.,
years have large business with satterlee, BOst
wick q Martin, became suspicious, Of the firm year
check for the entire amount Of the nsurspces placed
through them n be distributed. had been sending them
only checks, for the amounts due the several com
paTies and made payable % the companies
At r. &. Dun & Co.'s, Mr.. Morrow, Of the firm
said that so far be knew there no truth in
the rumor He had never known the firm b make
any change IN their way of transacng business with
satterlee bostwlck q Martin. The firm had always
been m the habit Of sending these insurance brokers
the checks for the amounts owing 20 the different
companies for them % distribute but the checks were
made payable 20 the different companies and not 10
the brokers so that all they made out OF the trans
actions was the commission from the firm Of Il. G. Dun
Co., and also that from the different insurance
companies.
BANK OFFICERS FORFEIT BAIL.