Kansas City daily journal. [volume] (Kansas City, Mo.) 1892-1897, 1896-12-24
BASE PLOT SAID TO HAVE CAUSED
THE CHICAGO BANK FAILURE.
SCHEME TO MAKE MILLIONS.
OBJECT WAS TO DEPRECIATE CAL
UMET ELECTRIC STOCK.
The Wreckers Intended Then to Buy
Up the stock, Consolidate with
other Roads and Line Their
Pockets In the
Deal.


Illinois, who has been charged with pulling
the wool over the eyes of the defunct
bank, would not talk to-day when seen in
his palatial home at Evanston. Through
an intimate friend, however, he made
statement which is calculated to inculpate
several directors. as We'll as two or three
men who are not connected with the bank.
Tie Post makes the above statement and
gives the following:
wv. A. Hammond is to be made the
scapegoat of thief allure OF the National
Bank of illinois," said the friend. Ham
mcnd is broken man to-day, but he is
not any more to blame for the amount of
money loaned on Calumet securities than
are the members of the finance committee
of the bank and its directors. 1t was
necessary to the purposes of a man con-
nected with the South Chicago City rail-
way and an officer of one of the best
known banks of this city TO depreciate the
Calumet electric roads stocks, and to this
end these two men brought about the
Brecking of the National Bank of Illinois.
| I''Of the bank funds s., 475060 had been
loaned on the Calumet securities. The
plan for wrecking was brilliant. Cause an
Investigation deprecfate Calumet stock and
buy 1t. Then combine this valuable prop
erty of sixty-three miles of new track,
equipment and franchise with the South
Chicago railway, eventually combining
with the Chicago City railway and make
fortune of millions within five or ten
years.
"The loan was increased with the full
knowledge of members of the finance COM
mittee and later on was made known to the
directors. Members of the finance commit
tee and officers of the bank were given
q
sell the road and, besides paying the bank
loan, make a good round sum for the di-
rectors. There has been a severe contest
between the General Electric and the
South Chicago City railway TO secure con-
troll of the bonds of the Calumet road, and
the stocks which go with them, and it was
thought that the road could finally be sold
at something like 100000 or Sl,0O0.000. 1t
was Il brilliant idea for man connected
with the South Chicago City railway to
wreck the bank, and the men who had been
backing Calumet through the bank. 1t has
succeeded, and the probabilities are that
the Calumet Electric will be sold to the
South Chicago City railway man and his
friend, the banker, who lent his name to
the scheme to make a guod pot out of the
deal himself.
'The part the banker took in the matter
was safe one: He called the attention of
the bank examiner to the fact that Calu-
intimating that the National Bank of Ii
linois had a good share of them and prob
ably had them all.
THE officers of the bank, finding that the
bank examiner was hot on their trail, be-
gan to push the transactions they had on
foot for the sale of the securities and the
clearing house became alarmed. Could the
matter have been delayed thirty or sixty
days the Calumet Electric securities would
not have been found among the banks as
sets. The sale would have been effected,
possibly at a loss to the bank, but without
disturbance TO the public or heavy loss TO
stockholders of the bank. But this course
would not suit the purpose of persons try
ing to control the Calumet Electric road.
"Three years ago e. s. Dreyer alone
owed the bank S1,000,0O0 and for three years
Mr.. Hammond has been trying to reduce
that. II was reduced one-half when the
doors of the bank closed and it was due
TO Vice President Hammond that this was
accomplished. II the securities for the
loans to these two men-Dreyer and Weiss
have disappeared, they disappeared Sat
urday. That point may come out later.
One director in the bank who has been
talking a great deal since the condition of
the concern became public took $4,000 out
of the bank Saturday afternoon.
There was no occasion for the falsifica-
ton of accounts, for the directors knew the
am0unt of the Calumet loan. You can't
cover up a 100000 loan in a bank where
directors do their duty"
The Illinois Trust and Savings bank with
drew to-day the sixty days notice given to
depositors Tuesday and paid all who called
for their money. There was no run what
ever. Some of the other savings banks also
withdrew the notice and the others that
gave 1t will do likewise. as the anxiety
among depositors has entirely abated.
Washington, Dec. 23.-Comptroller Eckels
to-day made the following statement in
connection with the statement made in
some quarters that efforts should have
been made TO save the National Bank of
Illinois from failing:
Every legitimate effort possible was
made. Before 1t closed the directors and
officers We're fully informed and Instructed
to- take immediate steps. The attention of
the clearing house committee was proper
ly called to the banks condition, and ! am
of the opinion that the course pursued by
it was not only justified by the facts but
was wise. safe and proper thing TO be
done. When a bank enters clearing
house association. its officers and directors
are not only bound to conduct il in such "A
way as to prevent loss and scandal to its
own shareholders and creditors but also
to the banks with which it is associated.
II regret that such n condition has been
developed in any bank in the system and
that any clearing house association has
been called upon to take such drastic
measures. But in the end it will prove a
benefit to all the banks of the country and
to every clearing house association and
add to the security of bank depositors."
SLL0UlS COMPANY IN TROUBLE
Suit for the Dissolution of the South