The sun. [volume] (New York [N.Y.]) 1833-1916, 1892-11-01
GHEJT IINlACI1L SCANDAL.
co,,,p.c OF n L., ndon bank and ~ Rniidinr
society,


LONDON. Oct. 31.Tho collapse Of the 1ibs-
orator Building Society simultaneously with
the downfall of tho London mud General Bank
is likely to prove ono OF the largest financial
sensations Of the generation. Eumors ns to
the great extent OF the disaster have been
current ever since tho double failure was AN
nounccl 4. in September last hut tho figures
presrnt.d nj a meeting of shareholders and
creditors of the I.iberator Society to-day arc
astounlin. even 10 those who have freely pr"-
dir,rd that the wreck would lac ono OF tho
wors: known in tho history OF such affairs
The official receiver said at to.,iay's meeting
that the society owed tho shareholders and
creditors .3,s,3OUO. whic the reserve fund
was only 100000. and was little better than
IL mere look cutry at that. Tho mortgages
amour. Il to 80. 423.uUO. and were nj lrst sup
posed t. DO good assets. but Investigation had
shown that they were probably Miuclcss. AS
g. 1873. oSr; had been lent to three companies
which arc now in liquidation. Their" were vir-
tunlly no Yrcc assets. there being only a5U.UUO
in sight with which to meet deficiency OF
s3,Uuu,u 900 The bulk OF tho money had been
lent upon nothing better than third liens 1t
was absurd TO talk about possible rcconstruc-
tion oi the society, for there was nothing to
reconstruct.
A stormy discussion followed tho rea ling Of
this doleful report. The upshot of it was
that committee was appointed to cooperate
with tho receiver in tho fOrlurn homo OF saving
something from the wreck. Everything points
to tho certainty that criminal prosecution
OF the directors OF tho concern will be tho
next ,hinE in order. Tn" ground Of action
will bo the charge II fraudulent concealment
of the operations OF the society,"
There is reason to believe that j. Spencer
Baifour. VI. T. the ice-Prosident and real
head of tho concern together with several Of
III. directors. have pocketed hundreds OF
Thousands of pounds in the shape OF com mis-
siuns. which are now alleged to he illegal
The litigation which IL in prospect will doubt
les; reveal numerous and extensive scandals
Of financial character.
The i ondun and General Bank was regis
tered in November lSS2. II had n n authorized
capital Of il."uv.ooo Mr.. j.. W.; llobts. late
Mayor of Croydon. was originally connected
with the Libcrnt"r Society. which was one of
the tow companies uron which the bank was
dependent Tor usinrss. Mr. Hobhss rcputa-
zion tor INTEGRITY led to many Investments in
Germ tut gave no reason for withdrawal. The
suspension OF tho bank on SEPT. l was at
tributrd to he failure Of the society, while on
the other hand the downfall OF tho society
among poor investors aud depositors were
Witnessed on the day Of the failure
Tho liabilities OF the society woro said
and the assets were said to he nearly as much :
hut tho former have been steadily increasing
and the latter dmi nishing
ed suicide u few weeks later Of ono OF the di
rectors OF the London and General Bank. Mr.
James Blewitt. who was found lying In EpGing
excitement and worry to seek his own destruc-
tion.