The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1893-05-14
WILL THE BANK PAY?
Director Predicts Loss to the De-
pocifOre


poSitorS.
SAN JOSE, May l3-As the Investigation
INTO The affairs Of the Santa Clara County
Bank proceeds the disclosures became
more and more startling. The directors.
"Ho Yesterday spoke in hopeful vein and
Saiu tAat things were not so bad as painted
anu 'n"t uepositors would be paid in full,
n"So now turned from optimists into
pessimists.
FRANK j. Brandon. who was appointed
py TIE directors TO expert the books, began
10 "oIh ms morning, aud already start
IiHI lAc'S nave been revealed which were
!t not ureaiht OF. It has been ascertained
IIi"' VII NIce-fIesldent Leonard and Cashier
- s"ata, the latter now dead, were In col
ius!oh with third party in this city TO rob
the Dank. SO far their peculations and
peculiar methods can be traced back as far
aS Decent Der, 1891, and further investIga-
lion may reveal The fact that they had
pesuh operations prior to that date
QuIte accidentally it was discovered that
they hau stopped TO forgery to accomplish
'neir ehus, having signed names to notes
which were held as collateral security for
money advanced. Such a statement is
maue on the authority of one of the direc-
tors VINO was present in the bank today
during the investigation. In fact, so thor
oughly alarmed have the directors become
over the revelations that they canno. keep
away from the bank, and although TODAY
no formal meeting was held they we're all
present and eagerly awaited every fresh
development.
mad every confidence" said one OF the
directors to your correspondent tonight
IN Hayward's uprightness and honesty.
out what was revealed to-day clearly and
unmlstakably showed that he was In collin
sion with Leonard and another party in
San Jose all the time Yes, sir: there has
been forgery of the blackest kind. but It is
too early yet TO give details. When they
are given 1t will be found that this has
been one OF The worst swindles ever per-
petrated upon banking concern.
1T was quite by accident that the dis
coYery was made that Leonard and Hay-
ward kept two books, one of which ap-
peared straight and above board, and was
for the board Of directors and for the in
specti0n of the bank commissioner. In
the other was recorded the defaIcatlons Of
the trio. comparison of the two showed
at once the system under which their
operations had been carried on. What
the defalcatiOns Of Leonard and HAYWARD
will amount to it is impossible as vet to
say. Remember the investigation was
only practically begun today, and 1t will
take some time before the whole truth Is
known.
Il am firmly OF the opinion that the de-
positors will not be paid in full. Ii has
been said that the directors were express
ing confidence that such would be The case.
but l don't know one director who has
said so. l never did. If the depositOrs
get fifty per cent they may consider them
selves well off. 1t is a wonder to me that
they left the desks and safe, as they took
everything else. Yes, there was $500 In
the safe, and what puzzles me is why it
was not taken also.
The amount Of certificates of deposit
not entered on the register so far is about
S60,0OO. but, OF course. q good many more
may turn up. On looking over the stubs
to-day 1t was found that the numbers did
not run consecutiyely. and that certificates
had been taken both from the front and
back OF the certifcate-book as fancy
seemed to dictate. There has been an
amount Of careleSsness and gross misman-
agement that is simply astounding.
You would be amazed at the large
number Of small depositoTs. Working
men. servant giFls, in fact, almost every
one of saving turn put their little all in
tile bank, aud it will go hard with most OF
them If they do not get their money back"
But surely the directors and share
holders are good for the amount due
depostOrs and will see them paid in fulI?''
THAT l very much doubt. II is ons
thing to say man is worth so much and
another thing to prove it, l knew some
shareho lders who are quite unable to stand
any assessment and some directors are not