The record-union., 1891-06-23
DEFUNCT BANKING HOUSES.
MORE INSIDE HISTORY RELATING
TO THE KEYSTONE BANK.
Correspondence Which Passed Between
Comptroller Lacey and Bank
Examiner Drew.
Special to the RECoRD-UNIoN.

PHILADELPHIA, June 22.-An official
copy of all correspondence between
Comptroller Lacey, Bank Examiner
Drew and others, with reference to the
| affairs of the Keystone Bank, which was
received from the Treasury Department
last week, was made public tonight. Il
is very voluminous, and much of it has
already been published in connection
with the investigation.
In letter from Drew to Lacey, the
former gives the result of his examina-
ton of January 9th, when he was in
formed of President Lucas $500, 900 de.
| ficit, and gives in detail the measures he
took to recover from Lucas estate. He
says Marsh was ignorantly led into these
| transactions, while Cashier, by Lucas
and the latter, on his death bed
exacted promise from Marsh to con
tinue the deception under Representations
that the money abstracted would soon re-
turn from Lucas enterprises.
Following this, at frequent intervals
were letters and kilograms in reference to
the condition of the bank and the reor-
ganizatiOn efforts. On February 10th
Drew's mind was evidently changing in
regard to Marsh, for he reported that de-
velopments made him suspicious of that
gentleman.
On February 2Sth Comptroller Lacey
wrote Drew, urging prompt measures to
rehabilitate the bank, and saving that
unless some other way was found at once
he would order the assessment of the
stock. After the assessment had been
made there were many other communi-
cations, and finally, on March 10Th, the
Comptroller telegraphed Drew to visit
the bank in the morning. The next
morning he received instructions to close
it.
On the same day Drew telegraphed the
Comptroller urging the appointment of a
receiver without delay. and suggested the
name of Mr.. Lynch. He added that there
were strong probabilities that the bank
would be reorganized by wealthy men.
The same day Comptroller Lacey sent
Drew the following telegram. marked
confidential: "Call at the southeast cor
ner of Eighteenth and Spruce streets, at
s O'Clock this evening, and give Mr.. w.
a close estimate of the assets and liabili-
ties. Encourage all efforts to reopen the
bank, andsgive out no information except
such as will conduce to that end, and then
with great care"
On March 22d, Drew wrote a private
letter to Lacey, advising that no action be
taken against Marsh, as his services were
indispensable toward the investigation.
Previous to Marsh's arrest, numerous
letters passed in regard to the reorgani-
zatiOn.
FAILURE OF AN ALABAMA RANK.
BIRMINGHAM (Ala.), June %. = The
Florence National Bank, of Florence,
Ala, closed it's doors to-day The imme-
diate cause is said to be the spread OF
false reports, which caused run on the
bank. Some confusion seems to have re-
suited by reason of Mr.. Flanagan, Cash
ier of the Alabama Banking and Fruit
Company, having been for a time also
President of the Florence National Bank.
NASHVILLE BANK SUsPENDS.
NASHVILLE (Tenn.), June %. - The
Nashville Savings Bank, conducted by
Julius and Max Sax, closed its doors this
afternoon. Messrs. Sax claim that the
suspension of business is due to the strin-
gency of the money market, and their in
ability to get rediscounts in the East
They believe they will be able to reopen
in a month and pay the depositors in full.
The assets are s665,000 and the liabilities
about the same.