Evening star. [volume] (Washington, D.C.) 1854-1972, 1893-01-27

with the greatest secrecy, 90 quietly, indeed,
| that President Billings Of the Globe National
Bank. a member Of the clearing house COM
mittes. and possibly the only bank president in
Boston who was known to be q stanch friend
Of Mr.. Potter. never received . notice TO at
tend any Of their meetings. Yet, despite all
| this, vague rumors that cloud hung over the
| Maverick began to reach those who were on the
! INSIDE in financial matters.
THE FALL OF TUE BASx.
| On Monday, October 26, the beginning
of the Mavericks last week Of business. STATE
street was thrown into excitement By the assign
| ment Of Irving A. Evans Co. Treeday after
| noon the Boston Herald came OCt with o col
rmr article giving the fret published informL-
ton Of tho joint account between Mr. Potter
I and Mr.. Evans discovering in 1t probable
cause for the young broker rs suicide. Mr.. Pot
! ter was not mentioned by name, but his identity
| was made sufficiently obvious. A quiet run
| on the Maverick Bapk began, and seldom,
IL ever, did financial president make more
gallant fight to sustain tie credit Of the ius.itu-
| ton he represented than did Mr.. Potter during
the whole of tina. eventful week. He realized
that there was but one argument to use with
| men who questioned the safety of their deposits,
and that was cash to the full amount Serene
and unruffled. apparently, President Potter re-
ceived his doubling patrons. and. after he had
given each his money as though 1t was the
| greatest pleasure in the world for him to do so,
| would assure them that the bank was all right
Hundreds Of thousands of dollars were at once
returned to the vaults by the treasured and
somewhat shamefaced depositors. but hun
dreds of thousands more were carried away.
| Between Monday and Saturday there was
run on the bank OF nearly one million and q
half-to be exact, STATS, 251-of which indi-
viduals asked for SS69,007 and banks for
| 5000, pa.
The Maverick rallied all its resources to meet
| this drain upon its vaults and succeeded in
doing 1t without allowing the clearing house
returns to show that anything was the matter.
1t called in loans to the amount Of 81 ,523 400,
drew from its reserve banks in New York
| SS46, l5S, called on other banks for 1926. 418
more and used SS3, $50 of its legal tenders and
Sls4 1852 OF its specie to meet these demands.
| From all these sources 81. 692, 488 were drawn,
and these figures throw some light on the 9ues-
ton how the Maverick was able to send 81 .250,-
| 600 to meet its obligations on Thursday, Octo-
| Der 80; 1880 900 more on October 80 and
81 800 900 more October 81, the last day it did
days of such an awful drain, balance in its
own favor of $500, 000 Few banks ever made
| such a showing the las: three days before they
suspended.
CONTROLLER LACEY's REPORT.
! But the clearing house committee had not
| been idle. On Tuesday Of the week in question
they received the report from Controller Lacey
and spent their days and nights trying to get at
/ the real value Of the banks securities. They
discovered that President Potter had borrowed
81 $50 900 from the bank Director Jonas Fl.
French $4,000 and Director Thomas Dana
! S400. 900 They estimated that the estates and
collateral Of the three directors were worth
| 81 ,500, 000 The principal other borrower was
/ Irving Evans Il Co. There numerous
other small notes, the makers Of which were
unknown to the clearing house committee, and
| thew ropDe1 the city dav
in an attempt to find out who they were. A
| good many OF these which were set down
worthless have turned out to be good. The
clearing house committee deemed that 81 ,00O.-
! 900 would not make the bank good, but with
one OF the committee as receiver II has already
paid 80 per cent in dividends.
When the clearing house committee at the
| close of their investigation confronted Mr..
| Potter with the three directors borrowings.
| aggregating nearly S25, 900, he declared that
there must be some mistake He has always
commended that the committee were very severe
| in their judgment of the banks securities and
promised If he were permitted to wind up the
| banks affairs he would pay every claim. dollar
for dollar. inside of year.
Henry NJ. Whitney. the street railroad mag
nate OF Boston, brother Of ex-Secretary Whit
ney, was coming forward with money to save
the bank. but the clearing house committee
showed him the way the bank had been loanIng
monev to the directors and he concluded not to
invest.
Mr.. Potter certainly expected to open his
bank Monday morning when he left Saturday
night. He told the writer Saturday morning
that in case of a run he had got all the money
necessary from New York. To another man he
showed a telegram from New York received on
Thursday offering aid and said he had declined
1t because he had all the money he needed
But the committees demands based on their
estimate of the collateral. could not be met,
though Mr.. Potter and Col French spent Satur-
day night in consultation at the Parker House.
Mr.. Potter cid not give up hope until nearly
morning
THE CLOSE OF THE BANK ORDERED.
Sunday forenoon the situation was reported
to the controller and he sent telegram order
ing the bank closed. The doors did not open
Monday. and President Beal of the Second
National Bank was appointed receiver. Mon
day night, November 2, the three directors were
arrested. Mr.. Potter at once furnished bail for
500. 900. and the other men finally found
sureties, though Col. French passed one night
in Jail first.
Judge Nelson declared the bail asked by
United States District Attorney Allen excessive,
and reduced his first figures more than one
half. He also quashed all the first batch of in
dictments. In the second batch all
quashed except the charges on which Mr.. Potter
now goes TO trial.
The business of the Maverick Bank, which
was worth a half million or more homes. has
been picked up by the other Boston banks. Its
magnitude was revelation to all its compel
itors. When its doors were closed by orders
from Washington it had 81. 900 Of ready
money on hand. and in Monday mornings mail,
the day after it suspended business, 500. 900
more came in cash collections In the three
DAYS following its closing S1.250. 900 we're
added to ITS cash deposits through the mails.
The deepest interest is felt in the result OF
the trial, which is sure to be a long one. Every
step will be contested by the defense. and it will
be one Of the greatest trials in the history OF
the United States courts.
COAL DEALERS PROSECUTED.
Members of the Rochester Exchange In