The morning news. [volume] (Savannah, Ga.) 1887-1900, 1892-02-05

rad Mr.. Sanchez, the other general man
ager at this time and the manager Of the
Spanish>American department at the
present time, accepted. under the
terms of his contract, full re-
sponsibility for the the Merzbacher short
age. This shortage consists OF two parts
a direct theft by Mr.. Merzbacher from Mr..
Sanchez of S4l9, so % and SIl9,O59 10,
which was an over-payment by Mr.. Merz-
bacher TO the former general manager OF
the Spanish American department. Since
the date or which the accounts were made
aud the shortage definitely determined the
item Of $ll9, SO 10 has been considerably
reduced on the books OF the company by
accrued renewal commissions retained
by Sanchez, and by him turned over TO the
company in cash. The larger item, repre-
senting the money Appropriated for his
personal use by Mr.. Merzbacher, has been re-
duced since Dec. 81, 1890, by Sl66,67l 50,
leaving a balance due Jan. !, 1892, of $685.
l5l OS. The actual net profits for the year
1871 to this department have not yet been
fully determined. but the balance sheets show
that they will not fall short of 300 900.
This leaves the balance due the company on
this account on this date a sum but little in
excess of $3.50, 900, for which the company
also holds abundant security.
The superintendent closes his review OF
the Spanish-American department with
these words: From the foregoing facts we
must conclude that Sanchez aud Merzbacher
were treated with degree of hberality
inconsistent with the best interests of the
company" That conclusion is not correct.
The department has always been eminently
successful, and the business has been OBJ
tanned at a normal cost.
The superintendent expresses the opinion
that s. L. Dinkenspeil was retained too
long as an agent of the company. Mr..
DinSenspeil secured for US large amount
of desirable business. The men whom he
insured we're among the wealthiest and
most influential in the cities where he
worked. 1t comes to my knowledge, how
ever, after a time, that his bushes methods
were Objectionable, and for that reason, in
the year 1889, his agency terminated. Mr..
Dinkenspeips contract comes under the
general illustration cited above. ex-
cept that he was personal
solicitor only. and many notifications were
made to enable him to handle the peculiar
class Of business which he wrote. Advances
We're made for the same purpose. 1t is
probable, however, that while there is to-
day on our books a large volume of busi-
ness of the best quality written by DIM
kenspeil, a reasonable renewal interest will
not finally liquidate the advances made,
and that this business will ultimately cost
us more than it should. For any error in
judgment in employing this man. as well
as for any ultimate loss, | do not desire to
escape from any proper responsibility.
MR.. LOOMS L. WHITE.
The superintendent of insurance discussed
at some length the relations which have
existed for about sixteen years between the
New York Life Insurance Company ana
Mr.. LOOMS l.. White, a member of its
board OF trustees and of its finance commit
tee, and two questions are raised-first, as
to whether or not a firm, a member Of
fob - hon,
OF trustees aud of its finance committee,
could act for It as brokers without having
the opinion of such trustees as to be of
value of securities colored by the probable
commission, which the firm would re-
ceive on such transactions; second, whether
or not the company had the right to pur
chase securities through such a firm of
brokers. The first question may be briefly
disposed of without discussing by a simple
statement of the results in the years covered
by Mr.. Whites connections with the New
York Life Insurance Company. About
$65, 000.000 of securities have been purchased
by the company's finance committee. and a
considerable proportion of this through
the firm Of which Mr.. White is q
& Co., and on the 30th of
June last the superintendent, after valuing
these securities at a time of depression,
found them worth to the company some
thing more than $4,000, 900 above the cost
value at which they are carried on the COM
pany's books. Such a result is the best
answer to all questions as to the wisdom OF
the finance committees actions, and in so
far as Mr.. Whites action influenced it as an
evidence of the value to the company of his
connection. The second question is one of
which opinions of counsel differ.
l have reviewed now with you the grave
criticisms Of the superintendent's report. l
shall stop here. / realize that there are
other criticisms which l have not referred
to and do not deem it necessary to do 30.
l have tried to present to you fairly the
facts concerning those of most Importance.
and believe have shown you that if there
have been errors in the management of this
company there has been no betrayal of
trust. A full criticism of errors, with an
equally full statement of manage
ment deserving commentator, would
have only been fair to you and per-
fectly satisfactory to me, however severe
those criticisms might have been; but the
superintendent of insurance, who was in
vited to examine the condition of this COM
pany while properly criticising whatever
he deemed criticsable, omitted to state the
other side of the case, and in addition, I'M
fortunately, so stated his criticisms as to
make it probable that you may have mis-
understood and overrated its Importance.
desire to reiterate my disclaimer of infal-
libility and repeat the messages sent from
Europe last summer. that in business Of
our magnitude mistakes are inevitable,
and we compare favorablv with others.
but our integrity Of purpose cannot
be shaken. General net results are the
touchstones in every business. We need
not go far to find confirmation Of this.
Errors have been made, perhaps, in the
management of every company doing busi-
ness, but as there are son Of common noto-
riety, may refer to them without seeming
to attack the companies themselves. In ad-
dtion l will say that to the best of my
knowledge and belief, all OF these cases are
natural experiences, incident to the fact
that no one is infallible. The Connecticut
Mutual lost outright 100000 through
the defalcation of its financial
correspondent at Indianapolis In
1888, the Mutual Benefit Life Insurance
Company of Newark, n. j., a company
eminently conservative in all things, lost
about the same amount in Elizabeth IN. j.
bonds. 1t is a well-known fact that the
Equitable Life Assurance Society marked
off in 1889 and 1890 almost 81 900. 900 on real
estate and that 1t carries nearly S12, 600
In it's published statement OF assists and sur
plus as "commuted commissions" agency
balances, etc., which is practically
another form OF expressing what
the SUPERINTENDENT calls "debtn in the
case of L. G. Vanuxem & Co. In the re-
port OF the department examination OF the
Mutual Life Insurance Com tany made in
1890. it was stated that 1888 ,701 As was
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