New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1891-03-24

experience in the banking business before taking
hold of the Washington National. He IS 1ortS
five years old, and comes from banking family
lie has several brothers who are cashiers OF banks
Evan Sherman was cashier of the United States
National Bank for several years.
| The statement of the Washington Natlonal
Bank issued in FebruaIg showed that S40o'ooo
| was due to deposi;Ors and 1897 900 to banks anu
that the loans amounted to 100000. recent
| prospectus of the institution said that the pahA
was opened for business on June 10, 1890, and at
the close Of the day it had received 81 03OOO IN de-
posits Since that time its deposits gradually IN
| creased up to October 20, when 1t had Sl,ooo'ooo
gross deposits. or about $7,OOO,0Oo net. Since
| that time strngency of the money market some
| what reduced the line of deposits, but they were
| granually increasing, and the bank looked to see
them soon equal or surpass the figures already
given.
OF the officers of the bank, General Dodge is the
wellknown railroad and military man. lie served
in she War of the Rebellion with distinction.
General Dodge is now in San Francisco, ana Is mol
expected to return for several weeks. NJ hoEl-
| tree, a we-knOwn member OF the Ootl0h En-
change and one OF the directors OF the Dahk Is III
the south on account Of his health .u,,.,.
Mr.. Sherman and his wife lie IN the apar'@tnen. @
| house No 81 West Seventy-third-st Ills apart
ments are furnished with excellent taste, Dut teIc
are no evidences of extravaganza in rhe appoint
| mcntS. -. 18th.
When q Tribune reporter called there last night
Mrs. Sherman said that her husband was almost
prostrated with illness, and his physician hau or
derGd complete rest, but he would he gag 10 seii
briefly ali that there was to be told. Mr. Sherman
appeared to be far from well. His manner was
exceedingly nervous, and he was evidently saneLi
ing aculely. lie soid he supposed that he couiu ,i
| be called injudciOus for having maze loans WIN
out sufficient security, but no one c0uld say tnaC
one penny of the banks money had ever Deeh IN IN,
tentionally diverted 10 his own account, he
hot ~ fa
| had been made but il would be found that they
| were greatly less than the amounts quoted by Mr.
Ibd John Silva count Gt wib 1fIasfRRSr' Re bank
for about two months and u short
time ago had overdrawn his account Dy
drafts These drafts were made on Silva irm at
bridgeport, and al first were duly hOnored. When
| the overClafts were discovered Mr. sherman scho
for Silva and received from him as cola'eril 4 =
mortgage deed for house in New orS ana defd i
for piece of country property. NJ sherman diu n.l
non know how this collateral had been valued py
the bank examiner. but Silva's lawyers had as. as
sured him that it would cover the amount 9I fd ie
deficit What the exact amount OF maj dehclV
was Mr.. Sherman again declined to say.
Mr.. Sherman asked: "Could n man ut-
| post with the bank, to his own account check
for $40 900. and, if that check were sent 70 the
person by whom it was drawn and held there for
some time. could the one who deposited II draw
| against it to the extent of, say, S9,OOO, lcaNlhS
tie bank without security if the original check
should be returned protested? Mr sherman
answered Yes, certainly" and he intlmated that
| II IN Tins way that tnc ONcGuTdllS Hdu "
Cured. lie declared, however. that no money had
| been drawn on the smaller checks after a pro-
tested check had been returned.
The other deficits were caused also by over
drafts, Mr.. Sherman said, and they were covered
| by. collateras, consisting of stocks and bonds;
How much these c0!laterals were valued at ne did
| not know but he did not think they were cntlreiy
worthless He could not say they were SUI
fciently valuable to cover the shortage; When
asked how the bank came to accept doubtful Sc
| curites Mr.. Sherman said that 1t was not known
| cOllatpralS
drafts had been discovered, and then il was deemed
better 10 take them, especially as they were the
only ones that could be obtained. lie refused TO
give the names of the persons who had ovcrdrawn
their accounts and then gave doubtful securities,
preferring that the information should come from
Mr. Sherman said that the deposits amounted TO
about S7O0,000-he could not give the exact
fgnrcs-and he did not see how the depositors
could lose anything. Bank Examiner Hepburn and
Mr. Tappcn called at the bank on Saturday, but
Mr.. Sherman did not know then that any fault
had been found with the securities. At that
time, too the original deposit checks figured on
the books rs assets, and the overlraftS did not
appear. This he said is probably what Mr.
Tilghman refers To in his criticism Of Mr.. Sher-
mans methods. Mr.. sherman said he did not
know at whose instance Mr. Hepburn and Mr..
Tappcn came TO the bank on Saturday, but he
| supposed il was through Mr. 1llghman. Mr..
Tilghman, he said. represented a good deal of the
stock Of the bank. and he gave the impression
that the feeling between Mr.. Tilghman and him
self was not altogether cordial
Mr. Sherman said he would be at the bank to-
day if his physician would permit II. lie said he
thought that the closing of the bank was TOO
hastily decided upon and unnecessary. and that
everything would have come out all right II the
directors had left him alone. The first of the
loans made. he said, was TO save the bank from
loss and the man who had opened the account
from failure. lie does not believe, even now,
he sad that the bank will lose the amount
loaned, which, according TO Mr.. 1ilghman,, is over
$40. 900 Mr.. Sherman said the directors had not
been informed Of this first transaction but had
been of the two others. The third loan was Of
only - 300. and was secured by the bonds OF the
Prescott and Arizona Railroad Company to the
amount of $4,000. These bonds were consld-
cred good but the other securities would not stand
Clcarng-flousc scrutiny.
Sidney Dillon one of the directors of the bank,
was not at his home No. 25 West Fiity-scventh-
St, last evening when reporter called TO see him,
but his son-in- law said that Mr.. Dillon had not
heard of tine Impairment Of the banks capital
until late yesterday afternoon, and did not know
to whom the loans which were not properly fe-
cured had been made.
Chester ". Chaplin, another director, who lives
at No. 3i West Fifty-sevcnth-St., was expected
home late last night after months stay in Flor
ida, and naturally would not be intimately ac-
quaintcd with the causes which led TO the bank 5
trouble.
Frederick d. Tappcn. president of the Ga!atin
National Bank. when seen at his home, No. 40
East SiXty-cighth-st.. last evening. said u irst
heard of the impairment of the Washington Bank
last Friday, from confidential source, and on
Saturday | made thorough Investigation of the
affairs Of the bank, finding, as Mr.. Illghman m"n-
tions in his statement. deficit of about $4,000.
Being disposed 10 lcncncy, arranged TO continue
clearing for the bank upon the making up OF the
deficiency by the directors, and was prepared
this morning to receive certified check for the
amount named. $4,000, when the announcement
of the further deficit of S60,0U0 was made.
waited to-day until p. m before sending out
notice that the Gallatin Bank would stop clear
ing for the Washington, in order TO give the
directors opportunity to secure the whole amount
Si35, 900. if they inclined 10 do so. How
ever as the directors did not furnish tine money
to-day | did not feel warranted in continuing
| IN for han hc 70
by MIR Sherman this morning which appears on
the books a, due from banks, really represents
| kitcd checks of John ). Silva | never heard of
Silva and don't know who he is. He made
deposits of checks out-of-tOwn banks, and Mr..
Sherman might have been deceived as to their
value. | know OF no indication, however, of