Delaware gazette and state journal. (Wilmington, Del.) 1883-1902, 1891-05-21
1ng unEUKED EYsroNE.

The Broken Banks Accounts We're
Cooked TO Cover Declarations : Tho
Books Mutilated to Cover Up Crooked
ness.
PHILADELPHIA, May 15.--Prcsident G.
w. Marsh and Assistant Cashier Charles
w. Lawrence of the Keystone Bank are
expected to make full disclosures respect
ing the mismanagement of that institu-
ton, putting the blame on the late Presi-
dent. Lucas. They were given a partial
hearing before United States Commits
sioner Bell this afternoon, charged with
making false returns to the comptroller
OF the currency AS to the condition of the
bank.
Bank Examiner Drew, the principal wit
ness, told a startling story of the deception
practiced by the accused officials in their
endeavor to cover up the shortage in the
banks cash. He said he made examine
tons Of the banks books about twice
year. generally in January and July.
Marsh and Lawrence concealed the true
condition of the bank and the Lucas de-
falcation, he said, in most original
manner John Lucas was the originator
of the bank and its president up TO the
time of his death. Mr.. Lucas was reputed
to be a very wealthy man, but since the
failure of the bank the fact has developed
that he abstracted large sums from the in
stitution. Mr.. Drew told of the way in
which the shortage was covered up, as fol-
lows; President Marsh and Mr. Lawrence
would remove from the individual deposits
ledger whole leaves. After the examine
ton of the books these leaves would be re-
inserted. The effect of this work would
be to show that the deposits were much
less than they generally were Unjust have
been necessary to employ the services Of n
bookbinder to get the leaves back in the
book correctly. Mr. Drew characterized
this as an unheard-of method in bank
wrecking, lie claims that they falsiied
accounts as well, The entries showed
that the Chase National Bank and
New York owed the Keystone small
sums, but their accounts were swelled
so as to show that they owed
$4,000. AT one time, Mr.. Drew found
that $4,000 of discounted paper al
legged to be held by the bank
was missing. Altogether, the present de-
ticiency amounts to S99s, 600 Most Of this
Lucas deficit as Mr.. Drew sometimes
called it III his testimony. AT other times
he referred to ii as defalcation." The
witness told how Messrs Marsh and Law
renee acknowledged to him their manipu-
lations Of the banks books and it was
upon this acknowledgment that warrants
were obtained for their arrest. Mr.. Drew
sHltl MS BOl ms llTSL information US 10 tile
bad condition of the bank from one Of the
directors on January 6th. The only other
witness besides Mr.. Drew was one of his
deputies, who corroborated his superior's
testimony, The case was continued until
tomorrow, bail being renewed for both
the accused men,
PHILADELPHIA, May t7.--The inves-
tigation of the keystone Bank affairs
tl,al
day. At first there seemed to be
strong disposition to cover up the wrong
doing, and it is said that some political |
influence was brought to bear at Wash
ington TO effect this result.
Now, however, United States District |
Attorney Reed is pursuing the opposite !
course. lie refuses TO let President |
Marsh and Cashier Lawrence waive a
and insists upon calling all the
directors to the stand. The story told
is remarkable. 1t has been already re-
lated that the deficiency due to the
operations Of the late President Lucas
to nearly $l000,000.
All the testimony yesterday was to
the effect that only Marsh and Lawrence
knew the extent of the defalcation, and |
when they could no longer keep it
secret they undercstimatel the amount
Of the deficiency to the directors. Law
rence's brother, who had charge of the
edger, testified that pages were torn out
IF it whenever the bank examiner was
coming around. lie spoke to President
Marsh about it, but was told that il was
III right.
Ex Cashier John Hayes testified that
rom $4,000 to 100000 was borrowed
rom the Spring Garden Bank and no
,ntry made Of it. This money would
le counted by the bank examiner as
ash and Immediately afterward re-
urned 10 the Spring Garden Bank.
Directors Van Bell, jackson, Tarr
md Shellenberger all explained that
hey knew nothing Of the Lucas mat
er until December last, and then tried
9 have it fixed up on the basis of
darsh's Misrepresentation as to the
mount.
They had signed reports as to the
lank's condition now known to be false
Jut did SO on their faith in Marsh, with
,ut really knowing anything about the
accounts. The hearing will be continued
N Thursday.
PHILAnELPIuA, May 1s.-Ex-Congress-
nan Robert NJ, Yardley took charge Of the
keystone National Bank to-day as receiver,
laVing entered satisfactory security-a
lond Tor $4,000, Al! hope of reorganizinp
he bank has now been abandoned, but an
'lGort is being made to form syndicate to
AXE tire Sea tiirt property off the banks
lantls and dispose of the lots by private
ale. If it should lie sold AZ auction ii
would not bring anything near its yalua-
ion. Receiver 1ardley was of course.
Unable to give any estimate of the time
when he would be able to pay at first divi-
lend
President Marsh of the keystone is in
uch financial distress that he Is selling his
PERSONAL property with which to get means
9 live. His attorney says that all told, his
property Will not realize over $1,000. a
art of II Will be sacrificed to make I'm the
,eielt 81 y deia,llting tax collector for
whom MIR. Marsh had entered security.
An organization has been formed Of de.
'eStors in the Spring Garden Bank which
likely TO give trouble. They are headed
y hrhnl, Dumont of Carncross and
llXey's Ministries, and they propose to
lrst get a statement of the condition Of
fairs, and then, II they find that the
anEing laws have been violated they will
the officers.
PHILADELPHIA, May 2O.-President Lewis
4 the lhird National tank yesterday, tes-
llied i'll the Keystone Bank case that Inc
money advanced by the bank to secure a
eposit Of city money was given to Mr..
George Myers one of the directors of the
'ank. Myers said TO him: ssIf Won do tbis
VIII use my influence to get Mr.. liards
w, the city treasurer, to make the Third
city depository" The amount, Sl6,OO0,
vas advanced on q single-name note
ms was IN advance of Mr.. Bardsley's cleo