The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1893-08-13
A Receiver for the Home
Savings Bank.
THE ORDER Is SUSPENDED
A Petition by the Stockholders on
Which J. e. Farnum Was Ap.
pointed Temporarily.

Joseph WinterDurn ana otockHOlQerS IL
liam H. Barnes, E. FL. Knight, R. d. Rob-
bins. w. I. Wilson and Louis Corriveau,
and an order was entered citing the de-
PENDANTS. the Peoples Home Savings Bank
and its directors, to appear next Thursday
and show cause why the receiver should
not be permanently appointed.
Att o'clock last night Judge Sanderson
suspended the temporary order and cited
the plaintiffs to appear at IL O'clock to-
morrow morning and show cause why the
tenn porary order should not be revoked
These orders, folio wing each other in
such rapid succession, are the result of the
complaint which was filed yesterday.
Ii is an action brought to obtain tenn
pc rary injunction and restraining order en-
lolnlrg the defendants from taking possess
sion of or making any disposition Of any
of the property, moneys, funds or securi-
ties of the Peoples Home Savings Bank,
and upon final hearing that the order NAV
be made perpetual.
In the complaint it is alleged that ever
since the organization Of the savings bank,
the management If its affairs has been
and IS still under the control and direction
OF persons who were ofhcers, directors and
employees of the Pacific Bauk. and tfat
these persons constituted a majority of the
board of directors of the savings bank,
and that they have at all tines controlled
directed and man ged the business OF the
savings bank in the interest OF the Pacific
Bank, anu not in the interest OF the saw
ings bank and its stockholders and deposit
tors.
1t is further alleged that the Pacific
Ban k was made treasurer for the savings
bank, and while this was the case
the BOARD If directors retained the
same legal advisers as were in the employ
of the Pacific Bank, and that all loans and
investments were made under the order
Of the board of directors, constituted as
aforesaid, and under the direction of the
attorneys Of the Paci1c Bank.
1t is further charged that for a long
time prior to June 1, 1898, the defendants
conspired to increase he money and
funds Of the Pacific Bank to the neglect of
the affairs of the savings hank. and that
the money of the savings bank, VIII cb
should have been loaned out bv that in
s.itute. was first deposited In the Pacific
Bank and then loaned out. tie latter
bank getting the interest.
Then follows a long list Of transactions
by which hundreds Of thousands of dol
lars were tossed about by The finaD cier
like rubber balls In nursery, only the
Pacific Bank never came out the worse for
the tossing.
The plaintiffs en- aver that on account
OF the fraudulent actings of the defendants,
the directors Of the savings bank, and the
fraudulent diversion of the funds and
ready money of tie bank. It was eft with
out funds to AIRY on lis business, and was
cOnp peeled to suspend.
The petitioners state that they believe
there are sill sufficient curitles in the
vaults of the savings bank To pay all Of its
creditors, but that he defendants are try
ing to get possession of these securities
and Illegally dispose Of them. and they
therefore ask that j. E. Farnum shall be
appointed receiver, TO take entire posses
sion Of the securities and keep them for
the benefit Of the depositors and stock
holders of the bank.
When the petition was presented to the
court the order was Immediately entered
granting the petition. and William Farnum
was temporarily app" ntrd.
At late hour last night Attorney D. S.
Dorm, representing the bank, accompanied
by Attorney General Hart. went to Judge
SandersOn's house and prevailed on the
Judge to vacate the former order and set a
hearing for tomorrow.
IL his complaint Director Winter burn
makes Attorney ID. S. Dorm one Of the de-
PENDANTS, but last evening he addressed
communication to his attorneys, King g.
Shaw. instructing them to withdraw the
name Of Mr.. Dorm as a defendant if this
could be done without prejudlcipg the
complaint.
Mr.. Dorm was in the East at the time
the alleged fraudulent transactions took
place. and in consequences was in no way
connected with nor responsible for them
II have no desire or intention TO throw
the savings bank into liquidaton," said
Director Joseph Winterburn last evening.
II am simply acting as seems to me best,
and in the best interests OF the 1900 de-
positors Of the bank.
II have stood practically alone in the
board of directors for some time ami have
bitterly opposed actions which | CON
sidered as very detrimental to the bank.
to put it mildly, and this last step is sim
ply a method of getting the bank COM
pletely out of the hands of the directors
for the present. at least, and make it i'm.
possible for any one to make any Improper
use Of the securities should they wish TO
90 so.
D"This was the last resort, and onlv
adopted it when l became convinced tbnt
it was the only way out OF the difficulty.
THE Pacific Bank people who are in
tereSted in the savings bank have from
the first tried to use the latter institution
to bolster up their own. On the day befo,e
the bank closed $50. 600 in cash and srcuri-
ties were received from the saving bank
and short time afterward an attempt was
made to get possession of certificates
of deposit to the amount of $780, 900 which
our bank held as creditor If the Pacific
Bank. The attempt would have been
successful but for the action Of the Bank
Commi sioDers, who. when presented the
case to them, at once issued a restraining
order, and the secretary would not deliver
the certificates when the demand was
made.
"The same parties made an illegal at.
tempt to force Secretary Farnum out. and
elect in his place a Pacific Bank man. and
when he did resign the commission was
plac.d in his hands, appointing him a
special Bank Commissioner. and the
game was blocked again.
Now an other scheme has been sprnnp
to elect General Wiley president of the
savings bank, and Mr.. Farnum secretary
again. This was suggested to me by r.
n. Mcdonald Jr.. and as he can control a
majority of the stock in the savings bank.
and is in q position to put such plan into
execution, / have taken this action and
ASKED for "a receiver 10 be appointed. Mt
that have anything against the two men
AIMED for the position. not by any means.
but the only object in eIecting them
would be to get them out OF the bank as
special commissioners
"As say, the appointment OF a receiver
takes rho hank mt of the directors hands