Pittsburg dispatch. [volume] (Pittsburg [Pa.]) 1880-1923, 1891-05-17
ROTTEN TO THE CORE.
More Light on the Management Of the
Keystone National Bank.
HOW THE EXAMINER WAS FOOLED.
Philadelphias City Treasurer Behind S2OO.-
900 With the State.
THE WRECK LARGELY RESPONSIBLE


PHILADELPHIA, May 16.-The hearing
of Guideon W. Marsh, President, and
Charles W. Lawrence, ex-Assistant Cashier
of the broken keystone National Bank,
charged with falsifying the returns OF the
bank to the Controller Of the Currency,
was resumed here this morning before the
United States Commissioner. Bank Ex-
aminer Drew was questioned as to why he
did not discover during his regular eTamina-
tions that number of pages had been cut
from the banks ledger and afterward re-
placed.
In explanation he stated that in large
bank folio of 1000 pages it was not such an
unusual thing for the entry clerk to cut
pages from the ledger and paste them in for
the purpose of keeping individual accounts
in alphabetical order Neither he nor his
assistants in the course of their e1amlna-
tions of an individual account ledger follow
the numbers of the pages, or even the names
of the accounts, but simply see that the ac-
count balances. Mr.. Drew concluded his
testimony by stating that he did not give
the bank officials notice of the time when he
was about to examine the bank.
The Cashier Signed on Faith.
The testimony of John Hayes, cashier,
bore out to great extent the allegation
that has been made that the bank was prac-
tically run by small clique. Hayes never
assisted in making up the bank account for
submission to the controller, but signed it
when it was presented to him by President
Marsh. Marsh always made up the account
and as he had implicit faith in his honesty
he never questioned the statement.
He never knew until after the run in De-
cember last of the enormous amount of the
Lucas deficit When the bank examiner
was expected to visit the bank, Marsh would
borrow from $50, 600 to S75, 900 in cash from
the Spring Garden National Bank and place
it among the assets of the bank by which
means the banks reserve would be raised to
the legal amount required by law. No
entry was ever made of these loans on the
banks book and when the examiner had
concluded his examination the money would
be returned to the Spring Garden Bank.
No collateral was ever deposited at the
Spring Garden Bank for these loans. Money
was alsosborrowed from the Third National
Bank in the same way to meet their Clear
ing House Indebtedness.
How the Pages We're Juggled.
j. Frank Lawrence, brother of Charles
Lawrence, one of the accused men, testified
that he had charge of the ledger from which
the pages were cut. He discovered that the
pages had been cut from the book and spoke
to his brother and Marsh about it, but was
told by them that it was all right. The
pages would be cut from the book about the
time Of the expected visit of the Bank Ex-
aminer and were replaced after his depart
ure. He did not know who cut the pages
out.
Henry Van Bell, j. 7. jackson, Charles
G. Torr and DR.. Charles Shellenberger, all
of whom are, or have been at some period,
directors of the bank, showed by their testi-
mony that they knew but little of the
banks real condition, and never had any
idea of the amount of the Lucas
dficit or ''defalcation," as the Dis
trict Attorney termed it, until the
time of the run in December last
They also testified that they were never al
lowed to examine the assets of the bank, as q
special committee appointed by Marsh, and
generally consisting of Granville B. Haines,
Samuel Lucas and Louis Breka did this.
Treasurer Bardsley in Trouble.
A special dispatch from Harrisburg saws:
The publication of the small amount paid
into the State Treasury by City Treasurer
Bardsley, of Philadelphia, for retailers
licenses, has led to many inquiries at the
financial offices of the State. The report of
the Auditor General closes with the Both of
November, which closes the fiscal year, to
enable the financial reports to be made up
for the Legislature in January. Since the
close of. Auditor General McCamant's re-
port on the 30th of November last, City
Treasurer Bardsley has paid in over 5000, 900
on account of last years licenses, ETC.
On February q he made the first pay
ment of $780, 900 and on the 1st of March
the Auditor General, as required by law,
settled an account against Bardsley for over
S360,000 as remaining due on last years
revenues after the 100000 payment
had been made. Upon this Bardsley has
since made the following payments: March
1S,, $4,000; March 26, S50, 200; April 13,
$50, 900; May 6, $4,000: total, $780,
leaving over $500, 900 still due on last years
receipts.
What the State Can Do.
This account must be settled by Bardsley
on or before the LIST of June, or the case will
go into the hands of Attorney General
Hensel for collection. The Auditor Gen.
eral is without authority under the laws to
do anything in the matter beyond what has
been done. The security given by CITY
Treasurer Bardsley for State funds is s12O.-
900, but if the more than 5000, 900 now due
from him shall not be replaced by the 1st of
June, the Attorney General will get the
case into his hands, and he is not only en-
powered to proceed against the City Treas
urer and his sureties, but he can go into
court and demand an increase of the City
Treasurer's bond, and if the Court orders ad-
ditional security, he must furnish it or vacate
the office.
There is not much State money in the
hands of the City Treasurer for this years
Licenses, ETC., as few are paid until after
this season of the year. 1t is a matter of
common knowledge that very large
amount of money collected by Mr.. Bardsley
for the State was deposited to his private
account in the Keystone Bank when it
failed.