Evening star. [volume] (Washington, D.C.) 1854-1972, 1892-09-05
THE ACCOUNTS WE'RE PADDED.
Iron HAN CroolseIness brought to Light In
Philadelphia.


Sensational Developments we're made on Sat-
urday in Philadelphia a. the hearing of the mo-
ton for the oasiiug of 4. Z. s.ockwell from his
position OF assignee of the Mutual Banking,
Surety. Trust aud safe Deposit Company, and
the appointment of receiver for that institu-
ton. tn story brought out BY the witnesses
is in brief that during February and March,
1891, and March and April, 1892. the books
showed tina: the Iron Ea!l accounts in the bank
were padded by various false entries, involving
large sums Of money considerably above Slo0-
900.
| James II. Ecke-sley the first witness exam
lned, said he officer OF the Iron Hall,
''in name only. am supposed TO be chair
man of the finance committed, he continued,
/ but never served IL that capacity"
! The witness was shown the copy OF the agree
ment. In which the supreme officers asserted
: thai they had urgently requested and solicited
~. G. Davis, supp cashier of he order of the
Iron Hall, to adj ance 500 600 and which
forms The nucleus of the whole proceeding. He
admitted having signed it or April i, TO protect
: Cashier Davis, Who showed him "a statement
setting forth thai the bank owed the supreme
sitting of the Iron Hall S492 900
The next witness WIS DIR. &. II. Baxsr. the
SUP RENE medical director Of he supreme sitting
OF he order Of IKE lion Hail. and one OF the
ine.nhsrs who w9s present at the meeting on
April in Philadelphia.
/ On that occasion DR.. Bake said Mr.. Som
erb' asked Grs Davis whether he Mr.. D4yist
could not lake the Joint note OF The members
presei.t go 20 Indi.nap polls with il and raise the
money needed To h.iI the liutua nuHeiIig Conf
RAW ou;. Mr.. Davis suii he would no. do i.
/ but finally concluded ;ha he could r,Se money
| If necessary. SOmeTby said tha. he did not
want il 10 be Iron Hall none and Davis turned
| quickly 20 him and said thar 1t wrs none of lis
(Somerby business where Davis got the
money. so long az he gotit.
MIR. Davis said dat before he would do any,
/ thing hc had grievance which he wanted cor
| rected His principal. and about his ONLY,
! objection related to Somerby's clerks in Indian
| arolis. 1t was understood that if Davis liked
/ TIE matter up rs Tar as money was concerned,
Soue.b, would fix up the affairs of his Office
J and discharge some OF his clerks"
wasn't 1t understood that this fund to be
! given to the bank 70 appear on its face rs
/ ii il was contributed by the stockholders. and
| in fact. it an advance by the Iron Hall?' he
was asked
Yes; think that the understanding
| although nothing said. The Iron Hall did
not in tend 10 lose the money"
| 'liow did you arrive at that conclusion?''
"lntuitiyvly, l guess. but | really don't
| know"
From whom did you get the impression
that the money was to appear as If contributed
| by stockhoi1ersY
| 1T was the subject of general conversation
among the persons at the bank at the time the
| institution was closed
On cross-cxGmination DIR. B1ker explained:
when | signei that paper it was with the
unders landing that the Cnly object in exc
cutting it was. in of any accident or any,
thing happening to Mr.. Davis. or if the matter
should ever come M in the supreme sitting
that the agreement should not place the entire
burden on Mr.. Davis. but would show that we
were willing to assume our own part of the
responsibility"
''When you say responsibility do you mean
| financial responsibility
NO. sir: that never entered our heads.
Was ANYTHING said about who should be re-
sponsible tinancially?'
mo, SIR"
DISCREPANCY OF $4,000.
The next witness was c. III. reart Who was a
bookkeeper of the Mutual Banking Company
M. Haw kins. counsel for the indianapolis re-
ceiver, submitted 10 the witness copies OF &C
| counts. which proved To be monthly statements
of Supreme Cashier Davis dealings the MI
! tual Banking Company.
! Mr.. Hawkins directed the witness attention
| TO number of depo=its during JANUARY 1891
as follows: sS.250.5O. 1886. $1,000 81.
1913, s1s, s07.2l. s4.324.s0, S2.327.s5 and
/ s9o105.
These figures appeared at the end of the list
of deposits FOR the month, and the witness said
that they must hive been transferred from the
other books Of the bank. ag he did not know
where else he could &C, them. and as he made
all entries in the demand ledger. of which he
had charge.
Mr.. Hawkins then called the witness atten-
ton to the fact that the monthly account for
Januar;. 1891, showed balance of .l9l. 52l "a
to tho credit of the order OF the Iron Hall. and
| that the next statement. beginning February 2.
1891, starts of with the fact that there s bal
| ance to thecredi; of the order of the Iron Hall
Of Sl37 ,690. g. with difference Of some $50 900
between the two.
The witness sbovy tho pnnD.hjy .tayo-
ment beginning March Z, 1891, which showed
that deposits had been made during
| March.
The witness could not recolect if such had
been the fact. but said that there could not
| have been any deposit made unless it was shown
/ in the statInent.
/ Mr. Hawkins then submitted to the witness
the statement for March and April. 1892. which
| showed balance in favor of Supreme Cashier
Davis, on April 80. OF S440, 1929.
| WAS there any other credit to that amount
asked Mr.. Hawkins.
NO. sir, no other credit that know Of At
| least not entered by me-
| Mr.. Hawkins directed the witness attention
to an entry made at the end of this month.
marked Especial quote, which swelled the ac.
| count by &S4. 1889. This entry. the witness
said. in Cashier Hayes handwriting.
Was there anything which showed this
special debit"
Nothing that know of; took my entries
|
| The witness was next shown the statement
| covering the period from April 80 to May 3
| last. at the end of which another entry Of
special quote deposit for SS4l43s3. The
| witness said he knew nothing about that entry.
| On cross-exainination Mr.. Pesrt said that
| the special deposits might have been taken from
| the general ledger: that the witness did not
have charge Of the general ledger; that that
book was kept by Mr.. Hayes.
| A PADDED DEPOSIT.
Kingston q. Whalen, expert accountant, who
examined the bank books for the state, was
called. and his evidence was admitted despite
the objections Of Assignee Stockwell's attor-
peys. His testimony, which was intended to
prove that numerous small deposits, mentioned
above, came into the bank in the shape Of Sc
curities. shortage of S53 900 thus being ac-
counted for.
These deposits, he said, mentioning the Janu-
airy statement. did not appear in any Of the
| other books of the bank.
Then the difference" Mr.. Hawkins re-
marked between the SI91 36l. %. the balance
at the end Of January. 1891. and the Sl37 500. SO
exactly equals the sum of those numerous
depositsf'
| Eyes. sir
Now, refer TO the statements of the accounts
| between March and May 81 last. Il there any
evidence OF the special quote deposit of sS4,-
1889, except in these statemepts?"
There Is nothing whateyer to show such n
sum. There is no such account, and I exam