The morning call., 1893-05-16
No New Developments at
Santa Clara.
LEONARD HAS NOT FLED.
Sharp Criticism Passed Upon the
Conduct of President Pierce.
The Old Savings Bank.
Special to THE MoRx1Ne CALL

HelI peculdtO0S Ueean as lar DacK as
July, 1887. The first account kept was the
account Of Leonard and Hayward in deal
ing with mining stocks. The private ac-
count of Leonard and hayward shows
different sums taken from different funds
and then from time 10 time replaced from
other deposits to balance w. These fig
nres were kept on private memoranda.
and this mode o operating continued from
that date till the bank closed.
At first their operations were on small
scale and carefully concealed. but as they
progressed they became b0ldeT. Prior TO
the time the bank commissioner was to
appear each year and examine into the
condition of the bank, the notes given by
Leouard and Hayward were Withdrawn
and forged notes substituted for the exact
amount, dividing up among some fictitious
and some real parties the amount of their
peculations
These notes are all entered, or at least
the majority of them, on the notebook,
and when the alleged makers are invited
to ray then it will be discovered that they
are all forgeries. The bank does not even
know that now. but it is a fact all the same
that the names of many prominent cti-
zens in the county have been put on notes
AOl oAhlo lduSfuS 1LOul Cl-uO " CopoO
Among them are Judge Weller of Mil
pitas, a welI-known farmer; W. r. Nc
Cubbin; Taft and Hagerman, fruitmen
Mr.. Book, fruitgrowe:; Henry Pulen,
brother-in-law of Sheriff Bollinger and
others of equal prominence.
When the Bank Commissioner had got
through with his yearly examination these
forged notes were retired only to bob up
GnrRpaltr U bnu ha ha nj
lowing year.
No preense of keeping regular deposit
book was made for the past five years
The only entries existing in the present
book consist of a date, the name of the de-
postor and the amount, When a certif-
cate was cancelled a red line was drawn
through the name. but no date Of cancella-
tion waslever entered, so that it is impossible
to trace when the certificates were can
celled from the book. No entry has been
made in the book since last December.
None of the directors ever examined the
books of the bank and Leonard himself
IS known to have declared that ne had
everything his own way.
LeOnard's speeulatlons in stock conf
meneed prior to 1856. That year he made
S34, 900 in one deal. which amount he put
in bank in San Francisco. declaring that
It was pin money. This pin money soon
flew and went ahead to meet the departing
funds at the Santa Clara bank. II was
then that he began specializing with the
banks funds 10 reeoup himself, and for
awhile Leonard and Hayward kept a pri-
vate set OF books, showing their respective
proportions of their stealing, balanced in
neat shape and also showing very closely
with whose money the various stocks were
purchased.
The amount of certificates in the register
shows that the bank did very thriving
business in cancellations. Three-fourths OF
the total certificates issued for the past two
years have been marked cancelled.
Leonard knew for some months that the
bank was tottering. The fact that Presi-
| dent Pierce drew so largely out of the
bank few DAYS before The doors were
| closed, and the fact that at nearly every
annual meeting Leonard's salary was in
creased on the motion OF the president. to-
| getheT with the fact of Pierce's connection
| with the old savings bank In this city
| which failed and was wound up by Leonard
| as receiver, ought TO have put the directors
| on their guard.
An amusing story is told Of that last
named bank failure. 1t seems that this
bank was managed by j. II. Moore and
| became loaded down with real estate which
at that time was in a depressed condition,
| but which within a year or two turned out
! to be very valuable and would have
| brought the bank out nicely had proper
management obtained.
Suit was brought by the shareholders
| through Judge Moultrie TO compel the di-
| rect0rs to pay the amount of losses. An
| opinion was fled by Judge Spencer, who
| tried the case, awarding the plaintiff.
! Moultrle. judgment for himself and other
| stockholders to the extent OF several hun
| dred thousand dollars.
Pierce. before the matter came into
| court, it is said. loaded himself down with
stock bought from the scared stockhoId-
ers, expecting, apparently. to avail HIM
self of the Moultrie decision. 1t was
found. however. that before judgment was
rendered Moultrie had been paid in full
for his stock. amounting to $4,000. and ac-
cordingly the Moultrie suit was dismissed,
| leaving Pierce with a lot of stock on
hand, barred by the statute Of limitations
as against the directors. His only alter
native left was to order Leonard to FORE
close mortgages on valuable tracts of land
that are to-day worth from $500 to $1,000
per acre.
AS already stated these facts have been
obtained from an unquestioned source and
will be as startling to the directors and
! shareholders of the defunet Santa Clara
| Bank as to the public In general.
Everything WAS quiet around the bank
to-day. Bank Commissioner Knight re-
sumed his Investigation this morning. He
was not accompanied. as was expected by
his brother commissioners. f. E. Hay
ward, brother of the dead cashier. was in
the bank all day and took an active inter-
est in the proceedings. The attention of
the Commissioner was altogether taken up
in segregating and arranging the certifi-
Gates of deposit so as to get them in pre-
sentable order.
After the days labors were over the
Commissioner said there had been no new
developments to-day. He is only concern
| yet gone backward to ascertain when the
| crookedness commenced and 10 what ex-
tent it has been carried on.
"You will see therefore," he said, "tfat
/ am unable to give you any further in
| formation than was given on Saturday.
| Things are practically as they were then,
Uuly Iu5 CtIllHCdbeS are low aim 0Sb all
arranged in order. A few trifiing amounts
we're received to-day. but I expect they
are about all in.
II have no doubt the depositors will be
paid in full out of the banks assets, un-
less something unforeseen turns up. Bnt
at any rate the depostors must be paid, as
the shareholders are responsible. There
is no use in going over the same ground as
l went over Saturday, for, as l tell you
again. there have been no new develop
ments to-day. exI eet to finish my labors
in two days, and then will be able to re-
port the position Of the banks affairs. l
went to see Vice President Leonard this
afternoon, and he appears to me to be
very sick man, so much so that / deemed
IL humane not to ask any questions. 1 was
not there more than two minutes. Whether
i will 60 back TO see him again or not am
unable to say"
"DO Won think IL Ia true that Teonard