The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1897-04-07
WHY SOME TWIN CITY BANKS
WENT TO THE swALL DURING THE
RECENT SEVERE FINANCIAL
HURRICANE.
LEGISLATIVE COMMITTEE REPORT.
Minnesota Savings Bank Was as Bad
as Any-Washington Bank
Never Solvent.


ative to the causes which led to the
failure of 50 many banks in this state
has been made public by concurrent
resolution passed without objection to
speak Of. The plan is to have the
testimony which was given by Witness
es brought before the committee filed
with the secretary of state, where the
public may have access to 1t. When
the matter came up yesterday in the
house, Mr.. Feig objected to the sub
stitution for his resolution that the
! testimony be placed at the disposition
Of the prosecuting officers Of Ramsey
and Hennepin counties.
In reply to a pointed query from Mr..
Johns. of st. Paul, as to why the mat
ter should be kept secret, Mr.. Feig
likened the matter to evidence adduced
by grand jury, at which Mr.. Johns
expressed the view that the matter
which a legislative committee acted
upon the members had right to know
about.
Mr.. Feig further explained that he
had not anticipated any difficulty over
the matter, but feared, If the evidence
was brought out, that persons impll-
| Gated might seek to get away from
town. Mr. Barta came up with the
suggestion that others than people in
| st. Paul and Minneapolis might want
| to see evidence, and his motion that the
| evidence be placed in the office of the
secretary Of state was carried.
The testimony is quite lengthy, and
! contains much information which, If it
! could have been brought out some
| months ago, would have obviated much
| difficulty which has resulted from the
failure of some of the banks in the
Twin Cities. The report says in part:
In respect to the Bank of Minnesota,
| w. H. lightner, one of the receivers, tes-
| titled that mfOct Z, it appears by the
/ general balanace book that $135, 60595
was due the bank from the Fort Dear
| born National bank, of Chicago. This
| balance was incorrect to that extent.
| Other statements were made with the
| conclusion drawn that the account be-
| tween these two banaks was falsified
| to the extent OF 100000.
AS to the cause of failure of the
bank, it was testified that William
| Dawson owed it $2SL000 During the
| last thirteen months before suspension
! William Dawson, ST.. the ST. Paul
| Globe, the st. Paul Plow company, and
the Gladstone Land company, borrowed
| $3.50, 900 from the bank. Receiver Sey
| mour testified that besides the above,
| other directors borrowed money of the
| bank as follows: Oppenheim & Kali
man. $4,000 E. B. Stickney, $4,000;
| Mr. Miller, $780, "-- :rof~1 -t-.a.--
The expert Of the committee Mr..
| Temple. testified in the case of the Min
nesota Savings Bank that he had WIS.,
! tied the receiver and examined the eff
| fects, secured the reports made by the
etc To no nh nSyo ami a mr. cnRnHQ6 from
| w. T. Bickel a record book of the pro-
! ceedings of the bank as kept by them.
! He had attained all information pos
| sible. The first point he made to the
! committee related to the record book.
| The Union Savings bank of Rochester,
! Mimi, incorporated under the law of
! '68 was the basis of the Ramsey county
saving bank and this was later merged
! into the Minnesota Savings bank. At
| tached to the record book was a piece
| of paper which is now gone, and the
| connection between the Ramsey county
Savings bank, and the Rochester bank
| is not disclosed. Before the committee
! Mr. Temple was positive in his declara-
| ton that some statements contained in
| the book at the time he examined 1t
! had been removed before it was sub
mitted to the committee. He was I'M
able to say for what reason such pa
| per or papers had been re-
moved The charter of the bank
| provides that no president, truS-
| tee. officer OF, servant of such cor
| poration shall borrow the funds OF the
| bank. or it's deposits, or in any manner
use the same in their private business.
| The loans to A. S. Kittson and j. +.
| Raker. according to the bank eXamin-
| er's report of Oct. z, 80, were made
| before they became trustees. In q de-
| tailed statement accompanying this re-
| port under title bills receivable and IN
! debtedness of over $22. 600 is disclosed
| against these two gentlemen. This re-
| mort Of October. '95, was not filed with
| the governor until Feb. 6, '97, and no
| examination of this bank was made by
! the examiner between October, 80, and
! its SUSPENSION. The examination showed
| an Indebtedness of over $15,000 due TO
| fine bank from Hazel NJ. Bickel wife
of w. F. Bickel, the former president.
Mr. Temple stated that the latter in
| conversation stated that all loans had
! haen approved by the hoard of direc-
! tors but gave no excuse for the Dor
| rowing of the money by officers and
| directors.
Mr. Sheehan explained to the COM
| mittee at this point that the Indebted
| ness of Kittson and Baker was in
| curred nv reason of a note given by
| them for the purchase of a half inter-
| est in the charter of the Rochester
! bank. The only way to arrange this
was to give them a seat in the board
| of trustees as the trustees owned the
| charter After this had been done
| contract was drawn up to KittsOn and
| Baker for one-half of the interest of the
| hank and afterwards they were elected
| IS trustees. The records submitted to
| the committee show that as long ago as
! April 26. 1894 the Minnesota Savings
! hank was considered rather shaky by
| the nllbIic examiner. AT that time an
| examination was made by that official
! and it was reported that the indebt-
edness of Hazel Biclkel was the chief
source Of weakness. He believed, how
! ever. that by changing the principal
| officers of the bank, the Kittson inter
est assuming d control, the institution
! would be able stotecOntinue business.
| Mr.. Temple gave some rather sensa-
! tional testimony at this point in rela-
| ton to the cash assets Of the bank, as
| shown by its books.
The cash account book showed that
! there was Cno hand cash and cash
| items amounting to $10,740, of which
/ only the currency was delivered to
! the receieyer n Among these items ap-
pears a quit-c1aim deed for SIS, which
| was never reeored, William Bickels
! livery bill tonthe3 sum of $12, not re-
ceipted and some laundry receipted
! bills The committee covered this mat
! ter in their report, as commented on
! in full at the time Of it's presenta-
ton last week by the G / Q b e.
Another direct violation Of the law
was a draft on the bank for $50 by J.
f. Baker. The bank paid it and car
| ried it as a cash item.
The most remarkable Of all these items car
| ries in the cash account, in the eyes of the
| committee was a note OF NJ. c. Tanner, dated
Jan. 2, 1897 This note failed to appear upon